June 7, 2011 / 1:49 PM / 7 years ago

Exclusive: Carlyle's HCR ManorCare readies $500 million IPO

NEW YORK (Reuters) - Carlyle Group CYL.UL plans to take HCR ManorCare public soon in an offering that could raise roughly $500 million, sources familiar with the matter said.

The initial public offering, which would be the latest of several from private equity owned healthcare companies, could give the nursing home and assisted living facility operator an enterprise value, which includes debt, of up to $2 billion, one of the sources said.

The IPO should happen sometime after the September U.S. Labor Day holiday, the source said.

HCR ManorCare is expected to file its IPO registration paperwork with the U.S. Securities and Exchange Commission within the coming month, the second source said.

The sources requested anonymity because the information is not public. The plans are preliminary and could change.

Carlyle and HCR ManorCare declined to comment.

Carlyle, one of the world’s most powerful private equity firms, bought HCR ManorCare for $4.9 billion in 2007, at the height of the leveraged buyout boom.

In December, Carlyle sold most of HCR ManorCare’s real estate assets to HCP Inc (HCP.N) in a $6.1 billion sale and leaseback deal.

    Carlyle, which has more than $106.7 billion under management, is expected to file for its own IPO in the third quarter.

    Toledo, Ohio-based HCR ManorCare would be following other private equity-owned healthcare companies to the public markets. These deals could prove attractive to investors as concerns mount about a slowing U.S. economy. Healthcare companies like HCR ManorCare are often viewed as defensive investments because of the steady amounts of cash that they generate.

    Hospital operator Vanguard Health Systems, controlled by Blackstone Group Inc (BX.N), disclosed terms for a $550 million IPO on Monday.

    In March, Nashville, Tennessee-based hospital operator HCA Holdings Inc (HCA.N), whose owners include Bain and KKR (KKR.N), raised $3.8 billion in the biggest private equity-backed IPO ever in the United States.

    Since its IPO, HCA shares have risen nearly 13 percent.

    Additional reporting by Megan Davies and Susan Kelly in Chicago. Editing by Paritosh Bansal and Lisa Von Ahn

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