The Ensign Group, Inc. (Nasdaq: ENSG), announced today that it has acquired Golden Acres, an operating skilled nursing and independent living campus, as well as a separate hospice business, both in Dallas, Texas. The acquisition was effective October 1, 2009.
"These strategic acquisitions strengthen Ensign's existing operational base and broaden our service offerings in the pivotal Dallas market," said Barry Port, President and Chief Executive Officer of Ensign's Texas-based Keystone Care subsidiary.
Golden Acres, situated on a sprawling 22-acre campus, was originally built by a non-profit religious foundation. In addition to its 264 skilled nursing beds, 222 of which are in private rooms, the campus includes a 39-unit independent living section which is frequently 100% full with a waiting list.
The Golden Acres acquisition also included a well-regarded hospice business, which has been renamed Custom Care Hospice. Custom Care provides palliative care and related hospice services, and can potentially be expanded into neighboring areas. Although many Ensign facilities offer hospice services through third-party agencies, this is the first time Ensign has engaged in the hospice business itself.
"We are excited about this hospice business, and believe it will provide an excellent platform for Ensign's further growth into an important service area for many of our patients and their families," said Christopher Christensen, Ensign's President and Chief Executive Officer. He added that Ensign expects the Dallas facility, which had a skilled nursing occupancy rate at acquisition of approximately 90% and an independent living census of 97%, to be accretive to earnings in 2009. Ensign paid cash for the Texas facility.
Ensign also acquired three facilities in Utah on October 1. The Utah facilities include Castle Country Care Center, an 80-bed skilled nursing facility in Price, South Valley Care Center, a 116-bed skilled nursing facility in metropolitan Salt Lake City, and Rock Canyon Rehab & Care Center, a 200-bed skilled nursing facility in Provo. The Utah facilities were purchased with a combination of cash and seller financing.
Ensign also allowed the lease on one of its Arizona assisted living facilities to expire, turning the operation over to a new tenant effective October 1, 2009. An Ensign affiliate had operated Greenfields Assisted Living in Mesa, Arizona since 1999. The lease expiration at Greenfields leaves Ensign with two assisted living facilities in the Phoenix metropolitan area, and will be slightly accretive.
Mr. Christensen reaffirmed that Ensign is actively seeking additional opportunities to acquire both well-performing and struggling long-term care operations across the Western United States. The four acquisitions and one lease expiration bring Ensign's growing portfolio to 73 facilities, 42 of which are Ensign-owned. Ensign affiliates hold purchase options on nine of the 31 leased facilities.
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