NEW YORK (The Deal) -- Private equity-backed Genesis HealthCare said Tuesday it has agreed to combine with Skilled Healthcare Group (SKH) in an all-stock transaction that would give Genesis a public currency.
Terms of the deal call for Skilled Healthcare shareholders to own 25.75% of the combination, which would control more than 500 facilities in 34 states and generate annual sales of more than $5.5 billion. The combination would keep the Genesis name and be based at that company's Kennett Square, Pa., headquarters, trading on the New York Stock Exchange.
The companies said that the combination would rank as one of the nation's largest providers of post-acute care services. Skilled Healthcare CEO Robert Fish, the former CEO of Genesis, in a statement said that he believes "scale and the ability to drive efficiencies will be critical to future growth," stressing the need for consolidation.
"The combination will expand our core business lines, significantly diversify our markets, provide opportunities for increased efficiency and enhance our collective ability to provide the highest quality patient care," Fish said.
Post-deal current Genesis CEO George V. Hager Jr. will continue in that role. The deal is expected to close early in 2015.