Genesis Healthcare acquires Sun Healthcare Group

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Genesis HealthCare has announced completing the acquisition of Sun Healthcare Group Inc, with effect from December 1. California-based Sun Healthcare p...

Genesis HealthCare has announced completing the acquisition of Sun Healthcare Group Inc, with effect from December 1. California-based Sun Healthcare primarily serves the senior population.

It owns SunBridge Healthcare, LLC which, directly through affiliates, operates skilled nursing facilities, assisted and independent living centers, and behavioral health centers in 23 states. The company owns SunDance Rehabilitation, CareerStaff Unlimited, and SolAmor Hospice.

As per the terms of the deal, Genesis acquired Sun for $8.50 a share of common stock in cash. The aggregate amount of the merger consideration was about $215 million that excludes the closing costs and the repayment of approximately $89 million of Sun indebtedness.

The skilled nursing care provider financed the transaction using borrowing under a term loan and available cash. The merger of two companies has led one of the largest skilled nursing providers in the country, with 422 skilled nursing centers in 29 states. It has also expanded Genesis HealthCare’s rehabilitation therapy business to more than 1,500 contracts in 46 states. 

The new company will have nearly 8,000 employees and combined annual revenue of around $4.6 billion.

The Genesis HealthCare headquarters will remain in Kennett Square, Pennsylvania. George V. Hager, CEO, Genesis said, “The addition of Sun’s portfolio enables us to expand the breadth of services we provide nationwide and creates economies of scale that better position’s Genesis for the challenges facing the post-acute care industry in the years to come.”  He adds, “We are also excited to partner with healthcare leaders across the country to create solutions to today’s healthcare challenges.”

Barclays serves as Genesis’ exclusive financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP, Williams Mullen and Arnall Golden Gregory LLP acted as its legislative advisors.

Genesis HealthCare is the largest skilled nursing care provider with more than 400 skilled nursing center and assisted living residences in 29 states nationwide. It also supplies rehabilitation therapy to over 1,500 healthcare providers in 46 states.




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