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Ventas, Inc.
(“Ventas” or the “Company”) announced today that it
executed a transaction whereby Ventas and the management team of Atria Senior
Living, Inc. (“Atria”) own 100 percent of Atria, effective December 21.
Atria's Chairman and Chief Executive Officer John A. Moore will continue to
lead Atria, one of the nation's premier providers of senior living care
services.
In the transaction, Ventas acquired 100 percent of various private investment
funds (the “Funds”) previously managed by Lazard Frères Real Estate Investors
LLC (“LFREI”) or its affiliates. The acquired Funds now own (a) a 34 percent
interest in Atria and (b) 3.7 million shares of Ventas common stock. The total
purchase price for these interests was approximately $242 million. Atria's
executives and employees, including Moore, now own 66 percent of Atria.
The transaction terms imply that the Company bought its shares of common stock
at a discount to the December 20 closing price of $64.69. In addition, Ventas
obtained certain rights and minority protections regarding material
transactions affecting Atria and is entitled to two seats on the Atria Board
of Directors. The base management fee under Ventas's management arrangements
with Atria will remain at five percent of revenues. At year end, Atria is
expected to have approximately $30 million cash on hand.
In the transaction, Ventas also extinguished its obligation related to the
“Earnout,” a contingent performance-based payment arising out of Ventas's 2011
acquisition of 117 Atria-managed senior living communities, for an additional
$44 million. This amount represents the discounted present value of the
potential future payment, which was reflected on Ventas's financial statements
as a liability.
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