Medical Properties Trust & Primonial Group Enter Joint Venture to Own 71 German Post-Acute Hospitals Valued at €1.635 Billion
June 07 2018 - 08:31AM
Business Wire
MPT to Recognize Gain of Approximately €500
Million Resulting From 6.0% Valuation of Hospital Rents
Total Expected Cash Proceeds to MPT of €1.14
Billion to Repay Debt and be Reinvested
Medical Properties Trust, Inc. (“MPT” or the “Company”) (NYSE:
MPW), a global leader in hospital real estate finance, announced
today that it has entered into agreements with Primonial Group to
form a joint venture pursuant to which a fund managed by Primonial
Group will acquire a 50% interest in an MPT portfolio of 71
post-acute hospitals throughout Germany. MPT will retain a 50%
interest in the portfolio through the joint venture and an MPT
affiliate will continue to manage the facilities. The transaction
values the portfolio at approximately €1.635 billion.
“This transaction will validate MPT’s pioneering entry into
European hospital real estate,” said Edward K. Aldag, Jr.,
Chairman, President and CEO of Medical Properties Trust. “Through
forward looking and creative investment structures, MPT assembled
this portfolio during the last few years in competition with other
large U.S. REITs, sovereign wealth, private equity and other
investors.
“Investor interest in this JV opportunity was strong and came
from funds based in Asia, Europe, Canada and the U.S. The
attraction was not only the chance for exposure to the attractive
healthcare sector in Germany, but equally the opportunity to
partner with the world’s leading specialist in hospital real
estate. Primonial Group, one of Europe’s real estate leaders, has
now committed to a long-term investment in hospital real estate
that demonstrates the importance of hospitals as an asset sector in
general, and MPT’s portfolio in particular,” continued Aldag.
“The benefits to MPT of the arrangement also include access to
less expensive forms of equity and debt capital and an independent
indication of MPT’s asset values,” concluded Aldag.
Based on the agreed 6.0% valuation of the portfolio’s 2017
rents, MPT expects to report a gain of approximately €500 million
upon closing. At closing, Primonial Group will acquire its interest
in the joint venture for cash, and a bank syndicate is expected to
provide secured financing. Total expected proceeds to MPT,
including its portion of the secured debt, will be approximately
€1.14 billion. MPT expects to use such proceeds to fully repay its
balances under its revolving credit facility, execute its pipeline
opportunities for continued investment in U.S. and European
hospital assets and for other corporate purposes. The Company is
suspending its previous guidance regarding 2018 net income and
funds from operations pending clarity on the timing of closing and
any reinvestment activities.
Closing of the transaction is conditioned on customary
conditions, including approval of the German Federal Cartel Office
and completion of definitive documentation concerning secured
financing, and is expected during the third quarter of 2018.
About Medical Properties Trust, Inc.
Medical Properties Trust, Inc. is a self-advised real estate
investment trust formed to capitalize on the changing trends in
healthcare delivery by acquiring and developing net-leased
healthcare facilities. MPT’s financing model helps facilitate
acquisitions and recapitalizations and allows operators of
hospitals and other healthcare facilities to unlock the value of
their real estate assets to fund facility improvements, technology
upgrades and other investments in operations. Facilities include
acute care hospitals, inpatient rehabilitation hospitals, long-term
acute care hospitals, and other medical and surgical facilities.
For more information, please visit the Company’s website at
www.medicalpropertiestrust.com.
About Primonial Group
Primonial Group, specialized in all aspects of wealth
management, selects, combines and offers comprehensive solutions
for wealth management professionals and their clients. It is
supported by a large number of specialists in residential property
investments and real estate funds, life insurance and annuities,
structured products and asset management, and has assets under
management (managed or advised) of €23.44 billion. For more
information, please visit the Company’s website at
www.primonial.com.
The statements in this press release that are forward looking
are based on current expectations and actual results or future
events may differ materially. Words such as "expects," "believes,"
"anticipates," "intends," "will," "should" and variations of such
words and similar expressions are intended to identify such
forward-looking statements. Forward-looking statements involve
known and unknown risks, uncertainties and other factors that may
cause the actual results of the Company or future events to differ
materially from those expressed in or underlying such
forward-looking statements, including without limitation: the
satisfaction of all conditions to, and the timely closing (if at
all) of pending transactions; the amount of acquisitions of
healthcare real estate, if any; results from potential sales and
joint venture arrangements, if any; capital markets conditions;
estimated leverage metrics; the repayment of debt arrangements;
statements concerning the additional income to the Company as a
result of ownership interests in certain hospital operations and
the timing of such income; the payment of future dividends, if any;
completion of additional debt arrangements, and additional
investments; national and international economic, business, real
estate and other market conditions; the competitive environment in
which the Company operates; the execution of the Company's business
plan; financing risks; the Company's ability to maintain its status
as a REIT for income tax purposes; acquisition and development
risks; potential environmental and other liabilities; and other
factors affecting the real estate industry generally or healthcare
real estate in particular. For further discussion of the factors
that could affect outcomes, please refer to the "Risk factors"
section of the Company's Annual Report on Form 10-K for the year
ended December 31, 2017 and as updated by the Company’s
subsequently filed Quarterly Reports on Form 10-Q and other SEC
filings. Except as otherwise required by the federal securities
laws, the Company undertakes no obligation to update the
information in this press release.
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version on businesswire.com: https://www.businesswire.com/news/home/20180607005592/en/
Medical Properties Trust, Inc.Tim Berryman, 205-969-3755Director
– Investor Relationstberryman@medicalpropertiestrust.com
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