Healthcare Trust of America, Healthcare Realty to combine in medical REIT deal (updated)

Diversified Healthcare Trust

28/02/2022 13:18

(Adds details and background)
    Feb 28 (Reuters) - Healthcare Realty Trust Inc  HR.N  and
Healthcare Trust of America Inc  HTA.N  have agreed to merge,
the companies said on Monday, creating the largest medical
office landlord in the United States. 
    The combined real estate investment trust will have 727
properties in its portfolio and a pro-forma total enterprise
value of $17.6 billion as of Thursday's close.
    Activist investor Elliott Investment Management had urged
Healthcare Trust of America in October to explore a potential
sale, saying the company's longstanding underperformance
compared to its peers has stoked frustration among shareholders.
 urn:newsml:reuters.com:*:nL4N2R72VC
    Healthcare Trust's shareholders will receive a total implied
value of $35.08 per share, including a special cash dividend of
$4.82 per share and a transaction exchange ratio of 1:1, the
companies said.
    Healthcare Trust's stock has traded between $20 and $35
since 2016, which resulted in Elliott's letter to the company.
    The offer values Healthcare Trust of America at $7.75
billion, based on 220.8 million outstanding shares, according to
Reuters calculations.  urn:newsml:reuters.com:*:nGNX1nnSv6
    Healthcare Trust's shares fell nearly 4% in premarket
trading on Monday, while those of Healthcare Realty tumbled 8%.
    The deal is structured as a reverse merger. Healthcare Trust
of America will become the corporate successor, while the
company's name will be Healthcare Realty Trust Inc. 
    After the transaction closes, which is expected in the third
quarter, Healthcare Realty shareholders will own 39% stake in
the combined entity, while the remaining will be held by
Healthcare Trust shareholders.
    

 (Reporting by Leroy Leo in Bengaluru; Editing by Krishna
Chandra Eluri and Sriraj Kalluvila)
 ((Leroy.Dsouza@thomsonreuters.com ; Twitter: https://twitter.com/LeroyLeo7;))