Omega Healthcare to Enter $525 Million Sale Leaseback with Ark Holding

Real estate investment trust Omega Healthcare Investments Inc. (NYSE: OHI) disclosed this week its intent to enter into a $525 million sale/leaseback transaction, under which a subsidiary of Omega will acquire 56 healthcare facilities operated by Ark Holding, a skilled nursing platform established in July 2007 by Behrman Capital, a private equity investment firm.

Under the terms of the deal, pursuant to a 50-year lease, the Omega subsidiary will acquire title the facilities currently operated by Ark Holding and lease them back to Ark Holding.

Rental payments will yield 10.7% annually during the agreement, according to an Omega Healthcare 8-K filing with the Securities and Exchange Commission.

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As of its second quarter financial filings, Omega Healthcare reported owned or held mortgages on 477 skilled nursing facilities, assisted living facilities and other specialty hospitals with approximately 55,075 licensed beds located in 33 states and operated by 47 third-party healthcare operating companies.

Behrman Capital established Memphis, TN-based Ark Holdings in 2007 through its acquisition of Covenant Dove Holding Company, LLC for approximately $250 million.

The Omega Healthcare sale/leaseback transaction is subject to closing conditions and terms and is expected to close in late 2013 or early 2014, a company spokesman told SHN.

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The company declined to comment further on the transaction.

Written by Elizabeth Ecker

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