UPDATE 1-Sun Healthcare to spin off property assets into REIT
* Expects deal to be completed in Q4
* Adopts stockholder rights plan
May 24 (Reuters) - Sun Healthcare Group Inc SUNH.O, which provides healthcare services for the senior population, said it intends to separate its operating subsidiaries and property assets into two publicly traded companies.
The operating company, through its subsidiaries, will continue to provide nursing, rehabilitative and related specialty healthcare services and will continue to use the Sun Healthcare Group name.
The other entity will own substantially all of Sun's currently owned property portfolio and to operate as a real estate investment trust under the name Sabra Health Care REIT Inc.
The separation will be effected through a distribution of common stock of the operating company to Sun stockholders, and the transaction is expected to be completed in the fourth quarter.
Prior to the spin-off, Sun also plans to raise additional capital through an offering of its common stock.
The company said with the split, the REIT will be able to realize the full value of the real estate portfolio, while the operating company will have the ability to pursue the same growth strategies that it has today, but with significantly less debt.
The company also said it has adopted a stockholder rights plan so that it can convert to REIT status in a timely manner, as the REIT status could be impaired if a single stockholder acquires more than 10 percent of Sun prior to the spin-off.
For the alerts, please click on [ID:nWNAB3209]
Shares of the company closed at $8.16 Monday on Nasdaq. (Reporting by Jennifer Robin Raj in Bangalore; Editing by Roshni Menon)
- Exclusive: Radar data suggests missing Malaysia plane deliberately flown way off course - sources
- Investigators focus on foul play behind missing plane: sources |
- Kremlin website hit by 'powerful' cyber attack
- West prepares sanctions as Russia presses on with Crimea takeover |
- UPDATE 1-Rolls-Royce concurs with Malaysia on missing jet's engine data