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February 21, 2014 at 09:00 AM
(Bloomberg) — Brookdale Senior Living Inc. (NYSE:BKD) has agreed to buy Emeritus Corp. (NYSE:ESC) for about $1.4 billion in stock, building a network of housing for the elderly across 46 U.S. states.
Investors in Seattle-based Emeritus will receive 0.95 shares of Brookdale for each share they own, the companies said in a statement yesterday. That values Emeritus at about $28.56 a share, a 33 percent premium to yesterday’s closing price. Including debt, the transaction is valued at about $2.8 billion.
The deal strengthens Brookdale’s platform as the country’s population ages and the number of residents living in senior- housing communities climbs. Brookdale, based in Brentwood, Tennessee, said the deal will create the “only national full- spectrum senior-living solutions company,” with more than 1,100 locations.
Emeritus has attracted attention in the private long-term care insurance (LTCI) community by helping to sponsor long-term care (LTC) planning awareness campaigns.
“This combination will improve our ability to deliver the best high-quality solutions for the growing demographic of aging seniors and their families,” Brookdale Chief Executive Officer Andy Smith said in the statement. “With still only 10 percent market share post-merger, we are confident of our prospects for driving further long-term revenue growth.”
The deal will increase Brookdale’s presence in high- population states in the West and Northeast, more than doubling its units in California, New York, New Jersey and Massachusetts.
