American Realty Capital Healthcare Trust shareholders trade their shares for Ventas shares.
At the end of last week, Ventas closed on its acquisition of American Realty Capital Healthcare Trust. The deal was first announced last June 2 as a stock-for-stock transaction valued at about $2.6 billion, with up to 10% of the ARC shares redeemable for cash. At the time, Ventas was trading at about $66 per share, but its shares have increased by almost 17% to $77 since then. Fewer than one million shares of ARC took the cash option, with almost all shareholders taking the Ventas stock. And why not? The shares had appreciated, Ventas has a growing dividend, interest rates aren’t going anywhere which implies higher valuations for Ventas, and there is of course the deferral of capital gains. With about $2.2 billion worth of new shares issued, Ventas better hope the acquisition is accretive, which it should be. The big question is what happens to ARC-II and ARC-III? Will Ventas double dip, or will some other REIT decide to take the ARC plunge? ARC is not letting up on deals, and the money keeps flowing in for acquisitions. Stay tuned for another ride in 2015.
