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Manor Care OKs $4.9 billion buyout

TOLEDO, Ohio — Manor Care Inc., one of the nation's largest nursing-home chains, agreed Monday to a $4.9 billion buyout offer from the private equity firm Carlyle Group.

Manor Care shareholders would get $67 in cash for each share, a 2.6 percent premium from Friday's closing price of $65.29.

But that is also a 20 percent premium over its closing price of $55.75 on April 10, the day before the company said it was evaluating strategic alternatives.

Based on an April 30 share count of 73.2 million shares, the stock portion of the deal is valued at about $4.9 billion. Manor Care said the total purchase price is about $6.3 billion.

Its shares fell $1.19, or 1.8 percent, to $64.10 Monday.

The cash deal is expected to be completed in the fourth quarter.

Toledo-based Manor Care operates about 500 nursing and rehabilitation centers along with assisted living centers and health-care businesses.

The company earned $167 million last year on sales of $3.6 billion.

It operates primarily under the Heartland, ManorCare Health Services and Arden Courts names. The company has 60,000 employees.

Carlyle Group manages $58.5 billion in assets in a variety of fields, including aerospace, defense, automotive and health care.

"This transaction affords a significant cash premium to our shareholders while allowing the company to continue its strategic direction and commitment to quality care," said Paul Ormond, Manor Care's chief executive.

The buyout is the latest in a string of deals involving health care companies. Big companies that bring in a large and steady flow of cash have become attractive buyout targets.

The nation's biggest for-profit hospital chain, Nashville, Tenn.-based HCA Inc., went private last fall in a $21.3 billion leveraged buyout. Nursing home operator Genesis Healthcare Corp., based in Kennett Square, Pa., approved a buyout offer in May. And shareholders of Scarsdale, N.Y.-based National Home Health Care Corp., which provides home heath care and staffing services, approved a buyout last month.