Ahead of the Bell: Brookdale Senior Living climbs
Shares of Brookdale Senior Living climbed before markets opened Friday after announcing plans to buy fellow assisted living services provider Emeritus for about $1.4 billion.
Brookdale said Thursday after markets closed that it would give Emeritus shareholders 0.95 shares of Brookdale stock in exchange for each of their shares, a 32 percent premium. That equates to a per-share value of $28.41, based on Brookdale's closing price Wednesday, the day before the deal was announced.
Brookdale values the deal at $2.8 billion, counting Emeritus's $1.4 billion in mortgage debt. It expects to close the acquisition in the third quarter.
Brookdale runs independent living, assisted living and dementia-care communities and continuing care retirement centers. It has 649 communities in 36 states. Once completed, the deal will give the Brentwood, Tenn., company 1,161 communities in 46 states.
Brookdale said the acquisition means it will have a place to offer within 10 miles of 6.5 million people who are 80 years or older. The company still claims only a 10 percent share of the market, meaning there is room to grow.
Shares of Brookdale Senior Living Inc. climbed 2 percent, or 61 cents, to $30.70 in premarket trading. If that trajectory holds, the company is heading for a new 52-week high. Shares of Seattle's Emeritus Corp. jumped 34 percent, or $7.29, to $28.75.