Seniors Housing Weekly Update - Active M&A Market For Year-End
November 20, 2012
Active M&A Market For Year-End
We have just five weeks before the year ends, and with all the holidays, it really ends up being less than that. There will be a mad rush to close transactions for all those people who want to be taxed at the lowest capital gains tax rate in decades before a likely increase in the rate next year. And trust me, buyers will use that to their negotiating advantage. But on the large scale, and here I am talking about billion dollar deals, the market received a bit of a jolt when one of the top executives at Brookdale Senior Living started talking about options they had to enhance shareholder value. The news sent Brookdale’s share price up by more than 10% in one day on heavy volume. The talk was about REITs, and how everyone is converting to a REIT. That’s a bit of an overstatement, but with ownership of a third of their units, the company does have some flexibility. One issue is that they still have an active search going on for CEO Bill Sheriff’s replacement. How that impacts the decision-making process is anyone’s guess. But if management is really talking turkey, shareholders could be very happy. Have a Happy Thanksgiving.