The Carlyle Group has entered into an agreement to acquire Manor Care, a provider of short-term post-acute and long-term health services, for $4.9 billion (€3.6 billion). Carlyle will take the publicly traded company private in an all-cash transaction expected to close in the fourth quarter of this year.
Manor Care, which operates 500 facilities in the US, announced on 10 April that it was considering strategic alternatives. Its stockholders will receive $67 per share in cash, representing a 20 percent premium over the firm’s closing stock price on 9 April. Carlyle will finance the buyout with a combination of commercial mortgage-backed securities, other debt financing, and equity, according to a statement.
Carlyle currently holds nearly 20 companies in its healthcare portfolio, including US-based pharmaceutical company MedPointe, Indian hospital equipment manufacturer Claris Lifesciences, and Japanese monitor manufacturer Colin Medical Technology Corporation. Karen Bechtel heads Carlyle’s health care sector team.
Carlyle has been extremely active in recent weeks. At the moment the company is said to be preparing a £11 billion takeover bid for UK cable TV and mobile phone business Virgin Media. The firm is also getting ready for the initial public offering of its Guernsey-based mortgage-backed securities fund Carlyle Capital Corporation, which the firm last week scaled down from $400 million to $300 million in response to instability in the subprime loan market. Carlyle also recently paid out $5.6 billion alongside Onex Corporation to acquire a division of General Motors.
Manor Care was advised by JP Morgan and Citi, as well as Cravath, Swaine and Moore. Carlyle was advised by Morgan Stanley, Credit Suisse, and Banc of America Securities. Its legal advisor was Latham & Watkins.