Post-acute services provider Genesis HealthCare and long-term care (LTC) facility operator Skilled Healthcare Group are merging in a 100 percent stock transaction that is expected to be finalized in early 2015, the companies have announced. The combined company will be one of the largest providers of post-acute care in the country, according to company executives, with trailing 12-month revenues (as of June 30) of more than $5.5 billion, more than 500 facilities in 34 states and about 95,000 employees.
“The constantly changing healthcare environment presents challenges for today’s post-acute healthcare industry providers,” Genesis CEO George V. Hager Jr. said in a statement. “The combination of our portfolios enables Genesis to enter the public domain, expand opportunities and enter new markets with our sub-acute and LTC facilities and our rehabilitation services business.”
Under the terms of the agreement, Genesis HealthCare shareholders will own 74.25 percent of the vote and value of the combined company, and Skilled Healthcare shareholders will own the other 25.75 percent. After the transaction is finalized, the combined company will operate under the Genesis HealthCare name, the headquarters will remain at Genesis’ current location of Kennett Square, Pa., and Hager will maintain that title.
Genesis Healthcare has more than 400 skilled nursing facilities (SNFs) and senior living communities in 28 states and also furnishes rehab services to almost 1,400 providers in 45 states. Holding company Skilled Healthcare, headquartered in Foothill Ranch, Calif., currently operates LTC facilities in California, Iowa, Kansas, Missouri, Nebraska, Nevada, New Mexico and Texas through several subsidiaries. Its offerings include 73 SNFs that provide sub-acute, rehabilitative and specialty health skilled nursing care; 22 assisted living communities; physical, occupational and speech therapy facilities; and hospice and home health services. Skilled Healthcare's total 12-month revenues as of June 30 were $831 million, and total employees numbered about 15,000.
“The combination will create an industry leader in the LTC market, where we believe scale and the ability to drive efficiencies will be critical to future growth,” Skilled Healthcare CEO Robert Fish, said in a statement. “The combination will expand our core business lines, significantly diversify our markets, provide opportunities for increased efficiency and enhance our collective ability to provide the highest-quality patient care. As the former CEO of Genesis, I can fully appreciate the tremendous value that these two excellent companies can bring as a combined enterprise and am excited about the possibilities.”
Steve Fishman and Arnold Whitman, co-chairmen of the board of Genesis HealthCare, said that the combined company will be able to “innovatively partner with payers and providers to meet the ever-changing needs of seniors across the nation.”
