Heritage Partners Sells Skilled Healthcare Group, Inc. for $640 Million.
The Company was purchased by SHG Holdings Solutions Inc., formed by Onex Partners LP, an affiliate of Onex Corporation (TSX: OCX.SV) and Skilled Healthcare's management team, for a purchase price of $640 million, including the assumption of indebtedness.
The transaction will provide liquidity for existing shareholders and give the Company access to new capital for future growth opportunities. The acquisition is subject to customary conditions, including receipt of required regulatory approvals, and is expected to close before the end of year or in early 2006.
Heritage made its initial investment in Skilled Healthcare in 1997, purchasing the company from the original family owners and leaving them with a significant ongoing equity stake. Through its transition from a family run business to a multi-state organization, Skilled Healthcare continued to grow both organically and through acquisitions. Since 2002, the Company, led by CEO Boyd Hendrickson, has had tremendous growth, achieving a 21% three-year compound annual growth rate in profits and increasing facilities from 50 to 70. Skilled Healthcare's management and employees are regarded as some of the most highly trained and respected in the industry with a strong focus on quality care.
Mark Jrolf, a General Partner at Heritage Partners, commented: "Skilled Healthcare has been a highly successful investment for Heritage. We believe going forward, the company's superior operating model combined with positive demographic and reimbursement trends will provide Onex with a unique platform to capitalize on an attractive long-term growth opportunity."
"All the success that Skilled Healthcare has had in delivering high quality care to its patients and value to its shareholders," commented CEO Boyd Hendrickson, "has been the result of the hard work and tireless effort of 9,000 employees who make up our team. We look forward to continuing to grow the company with them."
About Skilled Healthcare Group
Skilled Healthcare subsidiaries operate 70 long-term care facilities in the western United States, specializing in the care of medically complex sub-acute cases. The subsidiaries provide state-of-the-art in-patient care, rehabilitation therapy and hospice services. In 2004, the Company generated over $400 million of revenue.
About Heritage Partners
Heritage Partners, with $1.4 billion in capital under management, is the leader in Private Equity for family-owned businesses. Through its unique Private IPO(TM) structure, Heritage enables the owners of successful middle-market companies to realize significant liquidity from their businesses while maintaining a large equity investment. Heritage serves as an experienced strategic partner for such businesses as they seek to grow through acquisitions, organic business and operational improvements.