FOOTHILL RANCH, Calif., Apr 28, 2010 (BUSINESS WIRE) --Skilled Healthcare Group, Inc. (NYSE: SKH) today announced that its
Board of Directors has authorized the acquisition of substantially all
the assets of five Medicare-certified hospice companies and three
Medicare-certified home health companies. In addition, the Company will
enter into a fee-based management agreement for another home health
company and be granted an option to acquire substantially all of the
assets of such other company. The hospice and home health companies
collectively have operations in Idaho, Montana, Nevada and Arizona. For
the last twelve months ended March 31, 2010, consolidated revenue from
those nine businesses was approximately $47 million. The Company expects
the acquisition to be accretive to its earnings in 2010. Once the
acquired assets are fully integrated, the Company estimates annual
earnings accretion of approximately $0.11 per diluted share.
Boyd Hendrickson, Chairman and CEO, noted, "We are very excited about
this transaction which comes with strong cash flow, a successful
operating platform, a solid management team and higher than Company
average EBITDA margins. Additionally, it expands our business lines into
home health care and further expands our hospice platform. This lateral
diversification expands our footprint to three additional states;
thereby, diversifying our revenue stream both geographically and by
sector."
Further commenting on the transaction, Mr. Hendrickson continued, "We
are pleased that the management team of the businesses has agreed to
join Skilled Healthcare and look forward to building upon a proven
business model. I would personally like to extend a warm welcome to D.
Shane Peck who has agreed to accept a new position as the President of
our subsidiary Home and Hospice Care Investments, LLC, the parent of our
Home and Hospice subsidiary businesses. We also enthusiastically welcome
Jon Monks, who will be a senior operating head of the four largest
operations in Arizona and Nevada, as well as the balance of the strong
management team and staff members from these nine companies. We expect a
smooth transition as we integrate our businesses and are eager to
further expand strong relationships within the local communities."
Additionally, D. Shane Peck, President of the nine companies, commented,
"On behalf of our management team, we are thrilled to become a part of
Skilled Healthcare Group. This transaction provides a solid strategic
fit for our high quality platform and the potential to expand growth
opportunities for these businesses. We were selective in choosing an
acquirer and firmly believe that our patients and employees will benefit
from the combined resources and talent of our companies and the Skilled
Healthcare Group companies."
The acquisition is subject to the execution of a definitive agreement
and is expected to sign and close on May 1, 2010. Total consideration of
the transactions is approximately $62 million consisting of
approximately $43 million in cash with the remainder in the form of
certain deferred payments payable over a three to five year period. The
cash portion of the purchase price will be funded primarily from Skilled
Healthcare's senior credit facilities.
About Skilled Healthcare Group
Skilled Healthcare Group, Inc. based in Foothill Ranch, California, is a
holding company with subsidiary healthcare services companies, which in
the aggregate had consolidated annual revenues of over $750 million and
approximately 14,000 employees as of December 31, 2009. Skilled
Healthcare and its wholly-owned companies, collectively referred to as
the "Company", operate long-term care facilities and provide a wide
range of post-acute care services, with a strategic emphasis on
sub-acute specialty health care. The Company operates facilities in
California, Iowa, Kansas, Missouri, Nevada, New Mexico and Texas,
including 78 skilled nursing facilities that offer sub-acute care and
rehabilitative and specialty health skilled nursing care, and 22
assisted living facilities that provide room and board and social
services. In addition, the Company provides physical, occupational and
speech therapy in Company-operated facilities and unaffiliated
facilities. Furthermore, the Company provides hospice care in the
California and New Mexico markets. References made in this release to
"Skilled Healthcare", "the Company", "we", "us" and "our" refer to
Skilled Healthcare Group, Inc. and each of its wholly-owned companies.
More information about Skilled Healthcare is available at its Web site -- www.skilledhealthcaregroup.com.
Forward-Looking Statements
This release includes "forward-looking statements". You can identify
these statements by the fact that they do not relate strictly to
historical or current facts. These statements contain words such as
"may," "will," "project," "might," "expect," "believe," "anticipate,"
"intend," "could," "would," "estimate," "continue" or "pursue," or the
negative or other variations thereof or comparable terminology. In
particular, they include statements made by Mr. Hendrickson and Mr. Peck
regarding the timing, execution and anticipated effects of the
acquisition, including its projected impact on Skilled Healthcare's
financial performance. These forward-looking statements are based on
current expectations and projections about future events.
Investors are cautioned that forward-looking statements are not
guarantees of future performance or results and involve risks and
uncertainties that cannot be predicted or quantified and, consequently,
the actual performance of Skilled Healthcare may differ materially from
that expressed or implied by such forward-looking statements. Such risks
and uncertainties include, but are not limited to, the factors described
in Skilled Healthcare's Annual Report on Form 10-K for the year ended
December 31, 2009 filed with the Securities and Exchange Commission
(including the sections entitled "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" contained therein), and in our subsequent reports on Form
10-Q and Form 8-K.
Any forward-looking statements are made only as of the date of this
release. Skilled Healthcare disclaims any obligation to update the
forward-looking statements. Investors are cautioned not to place undue
reliance on these forward-looking statements.
SOURCE: Skilled Healthcare Group, Inc.
Investor Contact:
Skilled Healthcare Group, Inc.
Dev Ghose or Shelly Hubbard
949-282-5800
