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Skilled Healthcare Nursing Home Groups Asking JP Morgan For Help in Maximizing Stockholder Value & Maybe Find A Buyer

Posted Apr 13 2011 8:24pm

Last year was not the best for the company with getting fined with lawsuits.  Below is a link from August of 2010.  If you read some of the history here you might understand why they are looking for some assistance. 

The award in court was $95 million after a patient was dropped during a bed transfer fracturing her hip and shoulder.  Two attendants should be been making the transfer and not one was the findings of the jury.  Recent news also indicated the company insurance had run dry or there was inadequate coverage for events as such but I believe there was some type of reprieve given here.   Also from November of 2010 the GAO is reporting that nursing homes run by private equity companies may not be giving adequate care. 

Add on some budget cuts and there could be some real reason to worry about this and in that area they are not alone.  Since 2005 there have been at least 46 buy-outs of nursing-home operators worldwide, so a lot of investors feel there’s money with investing in the business of caring for seniors who are in nursing homes or using hospice services.  I think gold is a better choice today as healthcare is moving rapidly in so many areas with not a lot of stable predictions available.  BD   

FOOTHILL RANCH, CA – Skilled Healthcare Group, Inc., a holding company with subsidiary healthcare services companies announced this week that its Board of Directors has engaged J.P. Morgan Securities LLC to assist the company in exploring strategic alternatives to maximize stockholder value, including a potential sale of the company's real estate assets or the whole company.

While the company maintains a positive outlook for its performance as a standalone entity, its Board of Directors has recognized the current favorable market conditions and determined that a strategic transaction may enhance stockholder value. However, there can be no assurance that the Board of Directors will ultimately conclude that a strategic transaction is in the best interests of the Company or its stockholders at this time, or that the exploratory process will result in a transaction being consummated.

Based in Foothill Ranch, Calif., Skilled Healthcare Group and its wholly-owned companies operate long-term care facilities and provide a wide range of post-acute care services, with a strategic emphasis on sub-acute specialty health care. Long-term care facilities are located in California, Iowa, Kansas, Missouri, Nebraska, Nevada, New Mexico and Texas. These facilities include 74 skilled nursing facilities that offer sub-acute care and rehabilitative and specialty health skilled nursing care, and 22 assisted living facilities that provide room and board and social services. Skilled Healthcare Group also provides hospice and home health care in Arizona, California, Idaho, Nevada, Montana and New Mexico and leases 5 skilled nursing facilities in California to a third party operator.


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