LOUISVILLE, Ky.--(BUSINESS WIRE)--Apr. 4, 2016--
Kindred Healthcare, Inc. (“Kindred” or the “Company”) (NYSE:KND) today
announced that it has signed a definitive agreement to sell 12 long-term
acute care (“LTAC”) hospitals (the “Hospitals”) to Curahealth, LLC
(“Curahealth”), an affiliate of a private investment fund sponsored by
Nautic Partners, LLC (“Nautic”), for $27.5 million. The Hospitals have,
in aggregate, 783 licensed beds in Arizona, Louisiana, Massachusetts,
Oklahoma, Pennsylvania, and Tennessee.
Benjamin A. Breier
, President and Chief Executive Officer of Kindred,
commented, “We are pleased to announce this sale of 12 LTAC hospitals to
Curahealth, as this transaction creates both strategic and financial
value for Kindred. Optimizing our LTAC hospital portfolio is a key
element of our LTAC criteria mitigation strategy and this transaction is
another important step forward in our efforts. Nautic has a proven track
record of success in the healthcare sector and will be a strong partner
for these hospitals and the communities they serve.”
For the full fiscal year 2016, Kindred expects that the Hospitals will
generate combined revenues of approximately $215 million and earnings
before interest, income taxes, depreciation and amortization (“EBITDA”)
at approximately breakeven. The Hospitals have $14 million of annual
rent expense, of which approximately $8 million is with seven facilities
leased from Ventas, Inc. (“Ventas”) (NYSE:VTR).
Separately, Kindred has amended various master lease agreements with
Ventas and has filed today an 8-K with details of these amendments.
Kindred expects to realize cash proceeds upon closing the transaction
with Curahealth of approximately $21 million, subject to post-closing
adjustments, with the remainder of the purchase price to be paid upon
satisfaction of financial and other post-closing conditions. In
addition, the transactions with Curahealth and Ventas are expected to
generate future cash income tax benefits for Kindred of approximately
$38 million. Kindred anticipates reporting pre-tax charges of
approximately $54 million related to the Ventas lease amendments and
approximately $45 million to $55 million related to the transaction with
Curahealth within fiscal 2016. Kindred expects to close the transaction
with Curahealth in the third quarter of 2016, subject to customary
conditions to closing, including the receipt of all licensure,
regulatory and other approvals.
Forward-Looking Statements
This press release includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. These
forward-looking statements include, but are not limited to, the receipt
of all required regulatory approvals and the satisfaction of the closing
conditions to the transactions discussed above, the Company’s ability to
realize the anticipated proceeds and benefits from these transactions,
all statements regarding the Company’s expected future financial
position, results of operations, cash flows, dividends, financing plans,
business strategy, budgets, capital expenditures, competitive positions,
growth opportunities, plans and objectives of management, government
investigations, regulatory matters, and statements containing the words
such as “anticipate,” “approximate,” “believe,” “plan,” “estimate,”
“expect,” “project,” “could,” “would,” “should,” “will,” “intend,”
“may,” “potential,” “upside,” and other similar expressions. Statements
in this press release concerning the Company’s business outlook or
future economic performance, anticipated profitability, revenues,
expenses, dividends or other financial items, product or services line
growth, and expected outcome of government investigations and other
regulatory matters, together with other statements that are not
historical facts, are forward-looking statements that are estimates
reflecting the best judgment of the Company based upon currently
available information.
Such forward-looking statements are inherently uncertain, and
stockholders and other potential investors must recognize that actual
results may differ materially from the Company’s expectations as a
result of a variety of factors. Such forward-looking statements are
based upon management’s current expectations and include known and
unknown risks, uncertainties and other factors, many of which the
Company is unable to predict or control, that may cause the Company’s
actual results, performance or plans to differ materially from any
future results, performance or plans expressed or implied by such
forward-looking statements. These statements involve risks,
uncertainties and other factors in the Company’s Annual Report on Form
10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K
that may affect the Company’s plans, results or stock price.
Many of these factors are beyond the Company’s control. The Company
cautions investors that any forward-looking statements made by the
Company are not guarantees of future performance. The Company disclaims
any obligation to update any such factors or to announce publicly the
results of any revisions to any of the forward-looking statements to
reflect future events or developments.
Non-GAAP Measure
EBITDA is a non-GAAP financial measure. 2016 EBITDA for the Hospitals is
provided only on a non-GAAP basis, because of the inherent difficulty of
forecasting the timing or amount of items that would be included in
income from continuing operations for 2016, which is the most comparable
GAAP financial measure. As a result, a reconciliation of 2016 EBITDA for
the Hospitals to income from continuing operations for 2016 is not
available without unreasonable effort and the Company is unable to
address the probable significance of the unavailable information.
About Kindred Healthcare
Kindred Healthcare, Inc., a top-90 private employer in the United
States, is a FORTUNE 500 healthcare services company based in
Louisville, Kentucky with annual revenues of approximately $7.2 billion(1).
At December 31, 2015, Kindred through its subsidiaries had approximately
102,000 employees providing healthcare services in 2,692 locations in 46
states, including 95 transitional care hospitals, 18 inpatient
rehabilitation hospitals, 90 nursing centers, 19 sub-acute units, 604
Kindred at Home home health, hospice and non-medical home care sites of
service, 100 inpatient rehabilitation units (hospital-based) and a
contract rehabilitation services business, RehabCare, which served 1,766
non-affiliated sites of service. Ranked as one of Fortune magazine’s
Most Admired Healthcare Companies for seven years, Kindred’s mission is
to promote healing, provide hope, preserve dignity and produce value for
each patient, resident, family member, customer, employee and
shareholder we serve. For more information, go to www.kindredhealthcare.com. You can also follow us on Twitter and Facebook.
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(1)
Revenues were computed by combining the twelve months ended
December 31, 2015 data for Kindred and one month ended January
2015 data for Gentiva Health Services, Inc., which was acquired by
the Company on February 2, 2015.
Source: Kindred Healthcare, Inc.
Kindred Healthcare, Inc.
Todd Flowers, 502-596-7514
Senior
Vice President, Corporate Finance and Treasurer