Senior Housing Investments & Transactions: Genworth To Be Acquired for $2.7 Billion

Genworth To Be Acquired for $2.7 Billion

Genworth Financial (NYSE: GNW) has entered into an agreement to be acquired by a China-based investment company, China Oceanwide Holdings Group Co., for $2.7 billion. China Oceanwide has agreed to buy Genworth for $5.43 per share in cash. Genworth is a Fortune 500 company and a major provider of long-term care insurance and home mortgage insurance.

Under the deal, Genworth will become a subsidiary of China Oceanwide, which is based in Beijing. China Oceanwide has also agreed to help Genworth with its debt by providing a cash infusion of $1.1 billion in its U.S. life insurance businesses.

“The China Oceanwide transaction is the result of an active and extensive review process conducted over the past two years under the supervision of the board and with guidance from external financial and legal advisors,” James Riepe, non-executive chairman of the Genworth board of directors, said in a statement. “The board is confident that the sale of the company to China Oceanwide is the best path forward for Genworth’s stockholders.”

Upon completion of the transaction, Genwroth’s senior management team will continue to lead the business from its current headquarters in Richmond, Virginia. The company plans to maintain its existing portfolio of businesses, including its mortgage insurance businesses in Australia and Canada. The day-to-day operations are not expected to change as a result of the transaction, Genworth announced. 

“Genworth is an established leader in both mortgage insurance and long-term care insurance, which are markets that represent significant long-term growth opportunities,” Lu Zhiqiang, founder and chairman of China Oceanwide, said in a statement. “…In acquiring Genworth and contributing $1.1 billion of additional capital, we are providing crucial financial support to Genworth’s efforts to restructure its U.S. life insurance businesses by unstacking Genworth Life and Annuity Insurance Company (GLAIC) from under Genworth Life Insurance Company (GLIC) and address its 2018 debt maturity. In order to close the transaction and achieve these objectives, we have structured the transaction with the intention of increasing the likelihood of obtaining regulatory approval.”

Genworth will continue to focus on its key financial priorities, including strengthening its balance sheet and stabilizing and improving its ratings over time. It will also focus on key operational priorities, including executing its multi-year LTC rate action plan. 

“We believe this transaction creates greater and more certain stockholder value than our current business plan or other strategic alternatives, and is in the best interests of Genworth’s stockholders,” Tom McInerney, president and CEO of Genworth, said in a statement. “China Oceanwide is the ideal owner for Genworth going forward. They recognize the strength of our mortgage insurance platform and the importance of long term care insurance in addressing an aging population. The capital commitment from China Oceanwide will strengthen our business and increase the likelihood of obtaining regulatory approval.”

The transaction has been approved by both companies’ board of directors and is expected to close by the middle of 2017, subject to requisite approval by Genworth stockholders and other closing conditions, including the receipt of regulatory approvals. 

Goldman, Sachs & Co. and Lazard are acting as financial advisors to Genworth. Willkie, Farr & Gallagher LLP and Weil, Gotshal & Manges LLP are acting as legal advisors to Genworth. Richards, Layton & Finger is acting as legal advisor to the Genworth board of directors. Citi and Willis Capital Markets & Advisory are acting as financial advisors to China Oceanwide, and Sullivan & Cromwell and Potter Anderson and Corroon LLP are acting as legal advisors to China Oceanwide.

K4Connect Secures $8 Million in Series A Funding 

K4Connect, a technology company that creates solutions to serve older adults and individuals living with disabilities, has raised $8 million in Series A funding, led by Intel Capital. Intel Capital is a strategic investment and M&A organization that backs innovative startups and has invested $11.7 billion in 1,457 companies worldwide.

In addition to Intel Capital, the financing included investments from RGAx, LLC, a subsidiary of Reinsurance Group of America, Incorporated (NYSE: RGA), and Traverse Venture Partners. The company’s seed-stage fund investors also participated, including Sierra Ventures, Stonehenge Growth Equity, Lowe’s Corporation and Better Ventures. 

K4Connect will use the funds to accelerate the growth of its first product, K4Community, which is designed for residents and operators of senior living communities.

“There are close to 1.5 billion older adults and people living with disabilties in the world today, a market segment expected to grow to nearly 28% of the world’s population by 2050,” Scott Moody, co-founder and CEO of K4Connect, said in a statement. “That’s an enormous segment of society currently underserved by technology. Our solutions, of which K4Community is just the first, empower those we serve to live simpler, healthier and happier lives.”

K4Community enables smarter living environments, with users able to control their apartments, stay connected with loved ones through photo sharing or video chats, and stay more engaged in senior living community activities through event calendars and newsletters.

Presbyterian Retirement Communities Northwest Changes Name 

Presbyterian Retirement Communities Northwest has changed its name to Transforming Age. The change comes as the company has reached the 60-year mark. Transforming Age is a not-for-profit organization that operates three communities in Seattle and was founded in 1956. 

“We are extremely excited about this new name,” Torsten Hirche, president and CEO of Transforming Age, said in a statement. “Over the years, we’ve continually invested in housing, technology and other solutions that empower older adults to live without limits. Recently, it became clear that we had outgrown our original name. While we honor our heritage, Transforming Age better reflects our mission and vision going forward.”

The company first started by offering one of the first continuing care retirement communities (CCRCs) in Washington, and has since evolved its focus to include investments in technologies, state-of-the-art housing opportunities, as well as creative programs and services. The company recently expanded its family of communities with the Fred Lind Manor affiliation in 2014 and secured a $130 million fixed-rate bond issue to continue high quality senior housing for its Seattle communities, including a $30 million investment to reposition by the Fred Lind Manor and Parkshore assets. 

Evans Senior Investments Arranges Sale of California Community for $6.5 Million

Villa Rosa Memory Care, a 50-unit and 98-bed memory care community in Costa Mesa, California, has sold for $6.5 million, or $130,000 per unit. The community was purchased by Pacifica Senior Living, a privately owned company with more than 45 senior housing communities on the West Cost. The sale was arranged by Evans Senior Investments (ESI).

The community, located in Orange County, is 31,900 square feet and underwent a $1.72 million renovation in 2011. 

ESI represented the seller Sorenson Capital in the transaction. 

“Villa Rosa Memory Care represented an opportunity for the sophisticated operator or investor to leverage their expertise and bring the community to strong occupancy and returns,”Jeremy Stroiman, CEO of ESI, said in a statement.

Procura Healthcare Software Changes Name to Complia Health 

Procura Healthcare Software, a global provider of technology for long-term and post-acute care, has rebranded as Complia Health. It has also adopted a new mission statement: “enabling the business of caring.”

The new name reflects the company’s focus on compliance as well as comprehensive support for all funding sources that fuel health care delivery under constantly changing regulations, the company said. The name also reflect the completeness of the company’s product portfolio, including clinical, operational and financial solutions for home health, residential, community care and hospice organizations. 

“Our customers operate in an incredibly dynamic market,” Scott Overhill, chief technology officer of Complia Health, said in a statement. “One thing is certain: their business models will look different in the next 18-24 months. The key to success is being nimble enough to turn change into opportunity, and we’ve been helping our customers do that for 25 years.”

Written by Amy Baxter