IRVINE, Calif. — Griffin-American Healthcare REIT III and Griffin-American Healthcare REIT IV have entered into a definitive merger agreement in a tax-free, stock-for-stock transaction that will create a combined company with a gross investment value of approximately $4.2 billion in healthcare real estate assets.
Upon completion of the merger, the newly combined company, to be renamed American Healthcare REIT, will be the 11th largest healthcare-focused real estate investment trust globally, according to the companies.
The combined company plans to acquire the business and operations of American Healthcare Investors, the co-sponsor and external advisor of both REITs. Following the REIT merger and AHI acquisition, American Healthcare REIT will have a fully integrated management platform with capabilities in acquisitions, asset management, finance, accounting and tax, which are expected to result in operational cost savings of approximately $21 million annually.
More than 100 employees of AHI, including its three founders, will become employees of the newly combined company. Immediately upon the completion of the REIT merger and AHI acquisition, Jeff Hanson will be named executive chairman of American Healthcare REIT, Danny Prosky will be named president and chief executive officer, and Mathieu Streiff will be named chief operating officer. All other AHI executives and employees will retain similar roles and titles that they currently have with AHI as part of American Healthcare REIT.
“We believe that merging these complementary portfolios together, along with the sponsor company, will create a portfolio with meaningful scale and diversification, as well as drive significant operating efficiencies and earnings accretion for stockholders, well-positioning the company for future growth that should be rewarded in the public markets,” says Hanson.
The combined company will own an approximately 19 million-square-foot international portfolio of healthcare real estate comprised of 314 medical office buildings, seniors housing communities, skilled nursing facilities and other real estate-related investments.
The proposed transactions are expected to close in the fourth quarter of 2021, subject to certain closing conditions, including the approval of the REIT merger by stockholders.
The management team believes the REIT merger and AHI acquisition will position the combined company favorably for a future listing on a national stock exchange.