Formation and Safanad to Buy Extendicare U.S. for $870M
November 11, 2014
A group of investors led by Formation Capital and Safanad have agreed to purchase substantially the entire U.S. business of Extendicare (TSX: EXE) for $870 million. The purchasers will assume around $635 million of mortgage loans and other indebtedness, with $30 million of indebtedness to be repaid at closing. The purchase price represents a multiple of 8.8x trailing 12 months normalized EBITDA of $99 million from the business, which consisted of 141 owned and operated senior care centers; four centers operated under lease arrangements; 10 centers under managed contracts; and 21 centers in Kentucky leased to a third-party operator. Extendicare will retain 10 of the U.S. skilled nursing centers.