Sunrise Senior Living, Inc. (NYSE: SRZ) announced today that the Company and certain of its affiliates have entered into purchase and sale agreements with Ventas, Inc. and certain of its affiliates to sell to Ventas all of Sunrise's joint venture interests in nine limited liability companies in the U.S. and two limited partnerships in Canada, which collectively own 58 communities managed by Sunrise. The aggregate purchase price for the joint venture interests is approximately $41.5 million and is payable at closing, which is expected to occur in the coming months. The Company intends to use the proceeds from the transaction, after expenses, to pay down its bank credit facility and other debt obligations, and for working capital.
Sunrise will continue to manage the 58 senior living communities, together with the other 21 senior living communities in the Ventas portfolio that are already wholly owned by Ventas. As a condition of the purchase agreement, Sunrise and Ventas will amend the existing master agreement and management agreements to set forth their revised rights and obligations with respect to the management and other matters related to these communities.
"We are pleased that this agreement sets new performance, operating and reporting thresholds that, if met, will enable us to manage these assets for many years, and avoids the previously announced Ventas performance termination rights on a significant number of assets," said Mark Ordan, Sunrise's chief executive officer. "In addition, selling our joint venture interests to Ventas brings Sunrise additional funds to improve our balance sheet and provide a foundation for careful growth. We have seen clear improvements in performance, and we are excited to do all we can to continue this trend."