Kindred signs deals to buy more hospitals and rehab centers
Written on August 27, 2010
Kindred Healthcare Inc. has signed an agreement to buy five long-term acute care hospitals in Southern California from Vista Healthcare LLC for $180 million in cash.
The hospitals have 250 beds, combined, according to a news release.
Louisville-based Kindred (NYSE: KND), through its subsidiaries, operates in a total of 633 locations, including long-term acute care hospitals, nursing and rehabilitation centers and a contract rehabilitation services business. It has revenue of more than $4.2 billion and 53,500 employees in 40 states.
The assets being purchased from Vista generate annual revenue of about $150 million and earnings before interest, taxes, depreciation and amortization of about $27 million, according to the release.
Kindred is not acquiring the working capital of Vista or assuming any of its liabilities.
Kindred also has signed an agreement to acquire three recently-built nursing and rehabilitation centers in the Dallas-Fort Worth area for $38 million in cash instant personal loans guaranteed.
Richard Lechleiter, executive vice president and CFO for Kindred, said the seller has asked that its identity not be disclosed.
The centers have a total of 405 beds and generate annual revenues of about $24 million with EBITDA of about $3 million.
Kindred plans to develop two of the three nursing centers into transitional care centers that are focused on short-term rehabilitation and cases that are medically complex. It also plans to add a transitional care unit to the third nursing center.
Kindred expects to finance both deals with proceeds from its revolving credit facility, according to the release.
Within the first year of closing the deals, Kindred expects to incur transition costs in the range of $6 million to $8 million.
Filed in: finance.