Oct 7 2009
The Ensign Group, Inc. (Nasdaq: ENSG), announced today that it has acquired three Utah skilled nursing facilities, South Valley Care Center in West Jordan, a suburb of Salt Lake City, Rock Canyon Rehab & Care Center in Provo, and Castle Country Care Center in Price. The acquisitions were effective October 1, 2009.
"These strategic acquisitions offer tremendous potential operating synergies for Ensign's existing operational base in Utah," said Derek Gasser of Ensign's Utah-based Milestone Healthcare subsidiary. He added that staff, resident and community response to Ensign's acquisition of the facilities has been overwhelmingly positive.
Mr. Gasser noted that the physical plants are in superior condition, and the locations provide an excellent fit with Ensign's existing operations in Utah. The Price facility, with 80 operating beds, is one of only two skilled nursing facilities within a 50-mile radius. The West Jordan facility, with 116 operating skilled nursing beds, and the Provo facility, with 200 operating skilled nursing beds, are both located directly across the street from large hospitals.
The three Utah facilities were acquired from a family that had operated them for many years. "We are pleased that the former owners would entrust their life's work to us, and we are committed to growing and enhancing what they've built," said Christopher Christensen, Ensign's President and Chief Executive Officer. He added that Ensign expects the three facilities, which had a combined occupancy rate of approximately 48% at acquisition, to be operationally accretive to earnings starting in 2010. Ensign purchased the Utah facilities with a combination of cash and seller financing.
Ensign also acquired Golden Acres, a 22-acre skilled nursing and independent living campus in Dallas, Texas on October 1. The Golden Acres acquisition included a profitable and well-regarded hospice business, Custom Care Hospice. Although many Ensign facilities offer hospice services through third-party agencies, this is the first time Ensign has engaged in the hospice business itself.
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.
SOURCE The Ensign Group, Inc.
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