AdCare Health Systems, Inc., a leading skilled nursing and assisted living provider, has closed the previously announced acquisition of two skilled nursing facilities in Dublin and Marietta, Georgia, with the remaining third facility of this group located near Atlanta expected to close by end of May. The aggregate purchase price of the three facilities is $18 million.
The facilities have on aggregate 335 beds that generate an estimated $16.4 million in annualized revenues, and their addition is anticipated to be immediately accretive to AdCare’s earnings.
AdCare has initially financed the acquisitions through bank loans. These loans are expected to be refinanced with a loan guaranteed by the United States Department of Agriculture (USDA) on the Dublin facility and a Small Business Administration loan for the Marietta facility.
Combined with other transactions announced and in the process of closing, AdCare’s estimated annualized revenue run-rate is expected to exceed $175 million. This would represent an increase of more than 229% over the company’s revenues in 2010, and an increase of more than 555% over revenues in 2009 when it initiated its current M&A campaign.
“The acquisition of these facilities are among the some 19 facilities we’ve purchased or leased since we began our M&A program in the fall of 2009,” said Chris Brogdon, AdCare’s vice chairman and chief acquisitions officer. “These latest facilities significantly expand our presence in Georgia, joining the 10 facilities we already operate in the state. In addition to these Georgia facilities, we have also announced the agreement to purchase four skilled nursing facilities in Arkansas and the lease of one skilled nursing facility in Missouri.”
“We’re also considering a number of attractive new opportunities in the southern region of the U.S., as well as around our home base in the Midwest,” added Brogdon, “with our M&A program continuing to be a major focus for us in 2011.”
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