Monday, February 28, 2011

Big Health Care Merger
I just saw on that senior care and medical property owner Ventas, Inc. is purchasing Nationwide Health Properties, Inc. for $5.4 billion.   The combined company will, apparently, be the largest health care REIT in the United States.  I am trying to get more information on the valuation.   Both companies have medical office properties and hospitals, but it appears that the biggest component is senior housing and skilled nursing.

Update:  I was told by an industry insider that he was hearing that the deal was priced at 17 to 18 times NHP's FFO, which must be this year's anticipated FFO.  NHP had FFO of $2.14 per share in in 2010, based on its results released yesterday.  The trailing multiple was 21 times 2010's FFO, which dropped to 19.5 times using NHP's $2.30 of AFFO.

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