Health Care REIT, Inc. (HCN), a real estate investment trust, announced the pricing of its public offering of $1.4 billion aggregate principal amount of unsecured notes. The offering is expected to close on March 14, 2011.
The notes were issued in three portions, including $400 million aggregate principal amount of 3.625% notes due March 15, 2016, $600 million aggregate principal amount of 5.25% notes due January 15, 2022 and $400 million aggregate principal amount of 6.50% notes due March 15, 2041, expected to yield 3.705%, 5.332% and 6.571% respectively.
Health Care intends to use the proceeds of the offering to fund a portion of the purchase price of all the real estate assets of Genesis Health Care and investment in other health care and senior housing properties.
The Genesis Health Care Corporation acquisition is expected to be completed by August 28, 2011 and if the acquisition is not completed by that date the company will redeem all the notes at a price equal to 101.0% of the aggregate principal amount of the notes inclusive of accrued and unpaid interest.
During fiscal 2010, Health Care raised approximately $3 billion from debt and equity offerings, including $1 billion in fourth quarter 2010. At year-end 2010, the company had a liquidity of $982 million.
Health Care is a leading healthcare REIT with a strong portfolio of senior housing facilities, long-term care facilities and medical office buildings across the U.S. Health Care sector and currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors HCP, Inc. (HCP) also retains a Zacks #3 Rank, which translates into a short-term Hold rating.
HEALTH CR REIT (HCN): Free Stock Analysis Report
HCP INC (HCP): Free Stock Analysis Report
Zacks Investment Research
