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Ventas (VTR) Inches Closer to New Senior Investment Merger
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Ventas (VTR - Free Report) is inching closer toward the completion of its proposed merger with New Senior Investment Group Inc. , as stockholders of the latter have approved the deal. The move is a strategic fit, given the scope to capitalize on the senior housing industry’s recovery.
New Senior will merge with and into a subsidiary of Ventas, with the former surviving the merger as a subsidiary of the latter.
Nearly 99.8% of the votes are cast in favor of the agreement and the merger is now expected to close on or around Sep 21, 2021. Per the terms of the deal, shareholders of New Senior will get 0.1561 shares of the newly-issued Ventas stock for each share of New Senior’s common stock which they hold just before the effective time of the merger. If the merger closes on or prior to Oct 1, 2021, former New Senior stockholders together with Ventas stockholders will be entitled to receive a dividend of 45 cents per share of Ventas common stock on Oct 14 as of record as of Oct 1, 2021.
Per Debra A. Cafaro, Ventas chairman and CEO, “We are excited about our progress toward completing the transaction that enables Ventas to capture the powerful senior housing upside at a cyclical inflection point and complements our high quality diversified portfolio benefitting from demographic demand,”
According to the June press release, the transaction will enhance Ventas’ platform with New Senior’s high quality, independent living portfolio in markets that enjoy favorable demand-supply fundamentals. This will help the company cater to a large and growing middle-income senior population. Also, it will fortify Ventas’ present relationships with leading operators as well as add new operators.
The transaction will significantly fortify Ventas’ property base, adding New Senior Investment’s high-quality, geographically-diversified portfolio of 103 private pay senior living communities, including 102 independent living communities, located across 36 states in the United States.
With widespread vaccine roll-outs and resilient demand from a fast increasing population of seniors, the independent living senior housing industry is poised for solid growth in the upcoming years and hence, this transaction is a strategic fit for Ventas.
The transaction valuation is estimated to represent roughly a 6% capitalization rate on the estimated New Senior 2022 NOI. Further, Ventas is projected to realize $16-$18 million in annualized corporate general and administrative synergies starting 2022.
Shares of this Zacks Rank #3 (Hold) company have gained 1.6% over the past month, outperforming the industry's growth of 0.4%.
The Zacks Consensus Estimate for CubeSmart’s (CUBE - Free Report) 2021 FFO per share has moved marginally upward over the past month. The company currently carries a Zacks Rank of 2.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Ventas (VTR) Inches Closer to New Senior Investment Merger
Ventas (VTR - Free Report) is inching closer toward the completion of its proposed merger with New Senior Investment Group Inc. , as stockholders of the latter have approved the deal. The move is a strategic fit, given the scope to capitalize on the senior housing industry’s recovery.
New Senior will merge with and into a subsidiary of Ventas, with the former surviving the merger as a subsidiary of the latter.
Nearly 99.8% of the votes are cast in favor of the agreement and the merger is now expected to close on or around Sep 21, 2021. Per the terms of the deal, shareholders of New Senior will get 0.1561 shares of the newly-issued Ventas stock for each share of New Senior’s common stock which they hold just before the effective time of the merger. If the merger closes on or prior to Oct 1, 2021, former New Senior stockholders together with Ventas stockholders will be entitled to receive a dividend of 45 cents per share of Ventas common stock on Oct 14 as of record as of Oct 1, 2021.
Per Debra A. Cafaro, Ventas chairman and CEO, “We are excited about our progress toward completing the transaction that enables Ventas to capture the powerful senior housing upside at a cyclical inflection point and complements our high quality diversified portfolio benefitting from demographic demand,”
According to the June press release, the transaction will enhance Ventas’ platform with New Senior’s high quality, independent living portfolio in markets that enjoy favorable demand-supply fundamentals. This will help the company cater to a large and growing middle-income senior population. Also, it will fortify Ventas’ present relationships with leading operators as well as add new operators.
The transaction will significantly fortify Ventas’ property base, adding New Senior Investment’s high-quality, geographically-diversified portfolio of 103 private pay senior living communities, including 102 independent living communities, located across 36 states in the United States.
With widespread vaccine roll-outs and resilient demand from a fast increasing population of seniors, the independent living senior housing industry is poised for solid growth in the upcoming years and hence, this transaction is a strategic fit for Ventas.
The transaction valuation is estimated to represent roughly a 6% capitalization rate on the estimated New Senior 2022 NOI. Further, Ventas is projected to realize $16-$18 million in annualized corporate general and administrative synergies starting 2022.
Shares of this Zacks Rank #3 (Hold) company have gained 1.6% over the past month, outperforming the industry's growth of 0.4%.
Image Source: Zacks Investment Research
Key Picks
The Zacks Consensus Estimate for Alexander & Baldwin Holdings, Inc.’s (ALEX - Free Report) ongoing-year FFO per share has been raised 32.4% over the past two months. The company carries a Zacks Rank of 2 (Buy), currently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for CubeSmart’s (CUBE - Free Report) 2021 FFO per share has moved marginally upward over the past month. The company currently carries a Zacks Rank of 2.
Note: Anything related to earnings presented in this write-up represent funds from operations (FFO) — a widely used metric to gauge the performance of REITs.