Brookdale Rejects Acquisition Offer, Promotes Lucinda Baier to CEO

by Jeff Shaw

NASHVILLE, Tenn. — Brookdale Senior Living Inc. (NYSE: BKD), the largest owner and operator of seniors housing in the United States, has promoted Lucinda “Cindy” Baier from chief financial officer to chief executive officer. Simultaneously, the company announced it had rejected an acquisition offer from an undisclosed buyer for $9 per share.

The announcements were made in conjunction with the company’s fourth-quarter earnings call held the morning of Thursday, Feb. 22.

Brookdale suggested that the acquisition offer was too low to accept. Although the terms could’ve ranged up to $11 per share, that increase was “subject to conditions that the board did not believe were likely to be satisfied,” according to Brookdale.

“The company can ultimately create more value for shareholders by executing a turnaround strategy as a public company under new leadership,” according to a press release from Brookdale. “As a result, the board has concluded the formal strategic review process but remains committed to continuously evaluating all opportunities to enhance shareholder value.”

Baier’s promotion to president and CEO will take effect on Feb. 28. She replaces T. Andrew Smith, who is resigning from the roles as well as his position on the board of directors. Bryan Richardson, executive vice president and chief administrative officer, will also leave the company, effective March 9.

Two board members also announced their retirement: Daniel Decker, effective March 1, and William Petty Jr., effective Feb. 21. The board has elected Lee Wielansky, a Brookdale director since 2015, to serve as non-executive chairman. The board’s Nominating and Corporate Governance Committee will fill the vacant seats “in due course.”

Baier will continue to serve as Brookdale’s CFO while the company conducts a search for her replacement. The company does not plan to replace Richardson.

“It is time for meaningful change at Brookdale and the board is committed to making sure the company’s new strategic plan creates long-term value for our shareholders,” says Wielansky. “We are fortunate to have someone with Cindy’s leadership, financial acumen and operational experience to take the helm as president and CEO at this critical juncture, and the board is confident that she is the right person to guide a successful turnaround of our business.”

Baier joined Brookdale as CFO in December 2015. Her prior experience includes serving as the senior vice president and general manager of Sears, Roebuck and Co.’s Credit and Financial Products business, serving as the chairman of Sears National Bank, and serving on the board of directors for The Bon-Ton Stores and KKBS Group Holdings.

Baier has served as the CFO for many companies, including Navigant Consulting Inc., Central Parking System, Movie Gallery Inc. and World Kitchen LLC. She is a certified public accountant and is a graduate of Illinois State University, with a bachelor’s degree and master’s degree, both in accounting.

Based in Nashville, Brookdale operates 1,023 communities in 46 states that can serve up to 101,000 residents as of Dec. 31, 2017. Although it is the largest owner and operator of seniors housing in the country, the company has struggled for the past few years following its $2.8 billion acquisition of fellow giant Emeritus in 2014. The company is openly seeking a buyer.

The company’s stock price closed at $8.90 per share on Wednesday, Feb. 21, down from $14.46 one year ago and a five-year high of $38.72 on April 6, 2015.

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