Seniors Housing Weekly Update - Senior Living Stocks Rise After Health Care REIT Buys Sunrise
August 28, 2012
Senior Living Stocks Rise After Health Care REIT Buys Sunrise
What a way to kick off what is expected to be a very busy acquisition market in the last four months of the year. Last week’s surprise announcement that Health Care REIT is buying Sunrise Senior Living for $14.50 per share pushed the other senior living stocks higher in anticipation of higher valuations, lower cap rates and perhaps more REIT take-outs of other companies. One has to remember, however, that when Mark Ordan took over at Sunrise, with its shares trading below 50 cents and bankruptcy looming, a sale of the company was always on the table, as sort of an “exit” strategy if he could accomplish what many thought was a near impossible task. Unfortunately for Mark, he exercised some options at 92 cents per share last March for 225,000 shares and then sold them at half the $14.50 value. Oh well, no one is crying and he has plenty more low-priced options to exercise and sell at the full deal price. Congratulations Mark, consider it mission accomplished.