Companies In The News
Advocat delists from Toronto exchange
Advocat (Nashville, TN) has voluntarily delisted from the Toronto Stock Exchange after falling below the exchange’s continued listing standards. Advocat says the last day its shares will trade on the exchange is May 30.
Alterra to issue shares to investors
Alterra Healthcare Corp. (Brookfield, WI) has entered into a definitive agreement to issue $138 million of convertible senior debentures and convertible preferred shares to certain investors, including significant Alterra shareholders, as well as an investment entity formed by senior executives from Holiday Retirement Corp. and Emeritus Corp. (Seattle).
The transaction consists of $133 million of series A and series B convertible senior debentures with a conversion price of $4 per share, a 9.75% semi-annual payment-in-kind coupon, and a seven-year maturity; and $5 million of series A convertible preferred shares with a conversion price of $4 per share, a 9.75% semi-annual payment-in-kind dividend, and a mandatory redemption in seven years. The series A debentures and series A preferred shares will be convertible at any time at the investors’ option into shares of common stock of the company. The series B debentures will be convertible at any time at the investors' option into non-voting, series B preferred shares having rights, other than voting rights, substantially similar to the company’s common stock, Alterra says.
Alterra says it will use the proceeds from the transaction to finance the completion of residences under construction, repay certain interim bridge indebtedness provided by one of the investors, acquire a recently built portfolio of 14 company-managed assisted living residences from certain investors and affiliates, selectively acquire third-party equity interests in certain of its joint-venture arrangements, and for working capital and other general corporate purposes.
Atria to slow development pace
Atria (Louisville, KY) Chairman Michael Medzigian says the company will slow its development pace, focusing on its operations and how the company runs its facilities and services its residents. Medzigian recently told Business First of Louisville, KY, that while Atria is sound, he knows it has not been immune to the overbuilding the industry has recently seen. He says the focus on operations is "prudent, given where the market is today." Medzigian is also CEO of Atria owner Lazard Freres Real Estate Investors (New York).
Balanced Care to buy 10 black boxes
Balanced Care Corp. (Mechanicsburg, PA) has agreed to purchase the black boxes of 10 Outlook Pointe assisted living facilities. The facilities were developed and managed by Balanced Care on behalf of each special purpose entity (SPE) that made up the joint venture, or black box, and Nationwide Health Properties (NHP; Newport Beach, CA), the owner of the facilities. The acquisition will be financed by NHP, Balanced Care says.
The facilities include two in Florida, one in Maryland, one in Ohio, two in Pennsylvania, three in Tennessee, and one in West Virginia. The acquisition will bring to 17 the total number of SPEs acquired within the past six months, the company says.
Brookdale shareholder sells stock
A Brookdale Living Communities (Chicago) shareholder, The Prime Group, and certain of its affiliates, have agreed to sell 3.9 million shares of their Brookdale common stock to an affiliate of Fortress Investment Fund in a privately negotiated transaction for $58.8 million, or $15 per share. The shares represent about 39.8% of Brookdale’s outstanding shares, Brookdale says. In addition, Fortress has agreed to purchase from The Prime Group and Brookdale Chairman Michael Reschke up to an additional 87,500 shares. Upon completion of the sale, Brookdale says, Reschke will resign from Brookdale’s board of directors, and two of Fortress’ designees will be elected to Brookdale’s board.
In other news, Brookdale has launched its newly enhanced and redesigned Web site at www.brookdaleliving.com. The new site features on-line tours of Brookdale properties, the company says.
Capital’s 1Q00 revenues down
Capital Senior Living (Dallas) says it had 1Q00 ended March 31 revenues of $12.5 million, down from $15.5 million in 1Q99. The company posted a net income in 1Q00 of $1.5 million, 7 cents per share, compared to a 1Q99 net income of $3.9 million, 20 cents per share.
Capital says the results reflect the effects of previously announced strategic initiatives aimed at increasing ownership of assets, enhancing cash flows from operations, and discontinuing the use of joint ventures for future developments.
The company's initiatives resulted in a reduction of development fees in 1Q00 of $3 million, Capital says.
CareMatrix, Chancellor to sell facilities
CareMatrix (Needham, MA) and certain affiliates of Chancellor Senior Housing Group have entered into an agreement to sell up to 14 of their facilities for a total price of up to $26 million in cash, plus the assumption of about $200 million of Chancellor’s debt relating to the facilities. The facilities are assisted living, independent living, and skilled nursing facilities located in Florida, Connecticut, New Jersey, and Massachusetts.
In addition, Chancellor has signed a letter of intent to sell an additional 15 facilities.
The proposed transaction is still subject to certain conditions, CareMatrix says. It is expected to close by 3Q00.
CareMatrix also says it will further delay filing its annual report for FY99 ended Dec. 31. The company has been granted a hearing on June 1 to stay a determination by Nasdaq to delist its securities as a result of the delay in filing the 10-K. Nasdaq has told CareMatrix that no action on the delisting will be taken prior to the hearing.
Diversified opens new facility
Diversified Senior Services (DSS; Winston-Salem, NC) has opened a 30-unit independent living center in Pittsboro, NC. Somerset House of Pittsboro was developed and is managed by DSS.
Greenbriar redeems additional shares
Greenbriar Corp. (Dallas) has redeemed an additional $500,000 of series G preferred stock. The company says it has redeemed $4 million in its series G preferred stock since Feb. 1. The $4 million represents 38% of that stock class and about 13% of the company’s total outstanding preferred stock.
Greenbriar says it posted a 1Q00 ended March 31 net loss available to common shareholders of $1.4 million, 19 cents per share, compared to a net loss available to common shareholders in 1Q99 of $1.6 million, 22 cents per share. The company reported revenues of $10.5 million, up slightly from 1Q99 revenues of $10.2 million.
MSLS sees 24% increase in 1Q00 sales
Marriott International’s (Washington) Marriott Senior Living Services says it posted a 24% sales growth in 1Q00 ended March 24. The division’s operating profit was flat, MSLS says, as improved performance for established senior living communities was offset by start-up inefficiencies for new properties. Occupancy for comparable communities rose to 87% in 1Q00, the company says.
Overall, Marriott says it saw total sales in 1Q00 of $2.2 billion, compared to sales in 1Q99 of $1.9 billion. The company posted a net income in 1Q00 of $94 million, 37 cents per share, compared to a 1Q99 net income of $100 million, 38 cents per share.
Regent gets new symbol
Regent Assisted Living (Portland, OR) is now trading under a new symbol, RGNTE.
Sunrise director buys 40,000 shares
Sunrise Assisted Living (McLean, VA) Director Ronald Aprahamian purchased 40,000 shares of Sunrise common stock in March, according to a filing from the Securities and Exchange Commission (Washington). At the end of the month, Aprahamian owned 80,000 shares of Sunrise stock.
Sunrise says it saw a 49% increase in 1Q00 ended March 31 revenues to $76.8 million from $51.4 million in 1Q99. The company posted a 1Q00 net income of $4.1 million, 19 cents per share, compared to a 1Q99 net income of $7.2 million, 35 cents per share in 1Q99. Sunrise says the 1Q00 net income includes $4.2 million in pre-tax, start-up losses recognized in 1Q00 from the 22 new communities opened by the company in 4Q99 and 1Q00.
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