Morgan Keegan Updates Ventas Model Following Acquisition

Ventas, Inc. VTR announced that it will purchase 118 senior living assets from Atria Senior Living Group. Ventas will pay $3.1 billion in stock, cash, and debt assumption/retirement, or $230,000 per unit, for the facilities, which it will operate via a taxable REIT subsidiary. “We have updated our model for both this transaction and the accretive acquisition of the Sunrise Senior Living, Inc. Com SRZ interest in 58 Ventas senior living facilities,” Morgan Keegan wriets. “While the Sunrise transaction is accretive to FFO and FAD, we have modeled Atria as FFO-neutral and FAD-dilutive in 2011, though contributing to higher earnings growth.” Morgan Keegan said that in its view, Atria provides long-term benefits to Ventas that justify its high purchase price, similar to the Lillibridge Healthcare Services transaction earlier this year. Ventas closed Friday at $52.35; Sunrise Senior Living closed at $3.62.