Caretrust Subsidiary To Acquire Uk-based Reit, 137 Properties For $817m

A subsidiary of CareTrust REIT (NYSE: CTRE) is acquiring UK-based Care REIT plc and its 137 care homes in the United Kingdom in a deal representing about $817 million.

Care REIT plc has a portfolio of 137 care homes totaling about 7,500 beds in England, Scotland and Northern Ireland managed by 15 operators.

Under the deal, CareTrust subsidiary CR United Bidco Ltd has agreed to pay 108 pence in cash per ordinary share of Care REIT.

The REIT noted it believes the UK care home market is fragmented and “in the early innings of a demand-supply imbalance driven by an aging population with growing care needs, muted new inventory as construction and borrowing costs remain high, and tight capital availability.”

“Against this favorable backdrop, care home operators should benefit from a diverse funding landscape of public and private sources, which CareTrust expects to lead to solid occupancy rates and operating margins,” the company noted in an announcement. “CareTrust intends to fuel growth by deepening relationships with Care REIT’s existing operators, supporting existing development projects and expanding the pipeline of new investments, as well as building relationships with other operators.”

According to CareTrust CEO Dave Sedgwick, the REIT “has been following the UK for some time, looking for the right entry point.”

“We believe we have found it in the Care REIT platform, which has assembled what we consider to be an excellent, diversified portfolio of UK assets and operator partnerships,” he said in a press release about the deal. “We look forward to combining the Care REIT platform with our own and expanding our mission of growing with great operators in the UK.”

CareTrust’s acquisition comes a little more than a week after Toledo, Ohio-based Welltower (NYSE: WELL) announced its acquisition of Canadian senior living operator Amica Senior Lifestyles and its portfolio of 38 communities in a deal valued at $4.6 billion CAD.

This is a developing story that will be updated.

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