Kindred Healthcare, Inc. (NYSE: KND) announced last week that its subsidiaries have signed a definitive agreement to acquire five long-term acute care ("LTAC") hospitals from Vista Healthcare, LLC ("Vista") for a purchase price of $180 million in cash. Kindred also announced that its subsidiaries have signed a definitive agreement to acquire three recently constructed nursing and rehabilitation centers in the Dallas-Fort Worth market for a purchase price of $38 million in cash.
The Vista facilities currently generate annualized revenues of approximately $150 million and earnings before interest, income taxes, depreciation and amortization of approximately $27 million. The Vista transaction includes four freestanding hospitals and one hospital-in-hospital with a total of 250 beds all located in southern California. The transaction is expected to close in fourth quarter 2010.
Kindred announced as part of the acquisition of the Texas facilities that it intends to develop two of these three nursing centers into transitional care centers, focused on short-term rehabilitation and medically complex patients, and add a transitional care unit to the third nursing center. The three facilities have 405 beds and currently generate annualized revenues of approximately $24 million and earnings before interest, income taxes, depreciation and amortization of approximately $3 million. The transaction is expected to be completed by end of the third quarter 2010.
"We view the Vista transaction as a great opportunity to meet the growing demand for our services in southern California and expand our hospital operations. The Vista hospitals provide high quality services and care for patients with high acuity levels. The Vista hospitals also provide several clinical service offerings not currently available in our area hospitals providing us with an opportunity to expand our clinical services as well as attract more commercial and managed care business," said Paul J. Diaz, President and Chief Executive Officer of the Company.