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
BIRMINGHAM, Ala.--(BUSINESS WIRE)--Jun. 7, 2018--
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
“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
“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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180607005592/en/
Source: Medical Properties Trust, Inc.
Medical Properties Trust, Inc.
Tim Berryman, 205-969-3755
– Investor Relations