UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 29, 2016
MEDICAL PROPERTIES TRUST, INC.
MPT OPERATING PARTNERSHIP, L.P.
(Exact Name of Registrant as Specified in Charter)
| Maryland Delaware |
001-32559 333-177186 |
20-0191742 20-0242069 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) | ||
| 1000 Urban Center Drive, Suite 501 Birmingham, AL |
35242 | |||
| (Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (205) 969-3755
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 7.01. | Regulation FD Disclosure. |
On May 2, 2016, Medical Properties Trust, Inc. (the “Company” or “MPT”) issued a press release announcing the closing and funding of the RegionalCare/Capella merger and related transactions, as described below under Item 8.01. A copy of the press release is furnished as Exhibit 99.1 hereto and incorporated herein by reference.
The information contained in this Item 7.01 is being “furnished” and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise. The information in this Item 7.01, including referenced materials posted to the Company’s website, shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, or into any filing or other document pursuant to the Securities Exchange Act of 1934, as amended, except as otherwise expressly stated in any such filing.
| Item 8.01. | Other Events. |
As previously disclosed, on March 21, 2016, MPT and its affiliates entered into definitive agreements with RegionalCare Hospital Partners, Inc. (“RegionalCare”), an affiliate of certain funds managed by affiliates of Apollo Global Management, LLC (together with its consolidated subsidiaries, “Apollo”), under which MPT’s investment in the operations of Capella Healthcare, Inc. (“Capella”) would be merged with and into RegionalCare.
On April 29, 2016, this transaction closed and funded, effective April 30, 2016. As part of the transaction, MPT received net proceeds of approximately $550 million including approximately $390 million for its equity investment and loans made as part of the Capella transaction that closed on August 31, 2015. In addition, MPT received $210 million in prepayment of two mortgage loans for hospitals in Russellville, Arkansas, and Lawton, Oklahoma that MPT made to subsidiaries of Capella in connection with closing of the initial Capella transactions on August 31, 2015. The Company has made a new $93 million loan for a hospital property in Olympia, Washington, that is expected to be converted to a sale and leaseback arrangement upon regulatory approval. Additionally, the Company and Apollo have each invested $50 million in unsecured senior notes issued by RegionalCare.
MPT will maintain its ownership of five Capella hospitals in Hot Springs, Arkansas; Camden, South Carolina; Hartsville, South Carolina; Muskogee, Oklahoma; and McMinnville, Oregon.
| Item 9.01. | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| Exhibit No. |
Description | |
| 99.1 | Press Release dated May 2, 2016 | |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunder duly authorized.
| MEDICAL PROPERTIES TRUST, INC. | ||||||
| By: | /s/ R. Steven Hamner | |||||
| Name: | R. Steven Hamner | |||||
| Title: | Executive Vice President and Chief Financial Officer | |||||
Date: May 4, 2016
| MPT OPERATING PARTNERSHIP, L.P. | ||||||
| By: | /s/ R. Steven Hamner | |||||
| Name: | R. Steven Hamner | |||||
| Title: | Executive Vice President and Chief Financial Officer of the sole member of the general partner of MPT Operating Partnership, L.P. | |||||
Date: May 4, 2016
Exhibit 99.1
| Contact: Tim Berryman | ||
| Director – Investor Relations | ||
| Medical Properties Trust, Inc. | ||
| (205) 969-3755 | ||
| tberryman@medicalpropertiestrust.com |
MEDICAL PROPERTIES TRUST COMPLETES CAPELLA TRANSACTIONS
Applies Net Proceeds of $550 Million to Strengthen Balance Sheet
Birmingham, AL – May 2, 2016 – Medical Properties Trust, Inc. (the “Company” or “MPT”) (NYSE: MPW) today announced that it has completed the previously announced merger of the Company’s investment in the operations of Capella Healthcare, Inc. and RegionalCare Hospital Partners, Inc., and the related prepayment of two mortgages on Capella hospital facilities. Net proceeds from the transactions were used to reduce the Company’s borrowings by approximately $550 million.
“This transaction creates a stronger, well-capitalized tenant for MPT while at the same time significantly improves our balance sheet,” said Edward K. Aldag, Jr., Chairman, President and CEO of Medical Properties Trust. “We have always focused on leasing to the best tenants and positioning our balance sheet with best-in-sector strength and flexibility to minimize risk for our investors and be poised to take advantage of opportunities,” continued Aldag.
“After paying down our debt with $550 million of proceeds from these transactions, our net debt to EBITDA of approximately 5.6 times will be among the top third of all REITs. We will have $1.15 billion of availability under our revolver, very limited near term debt maturities and outstanding opportunities to selectively invest in hospital real estate leased to the best operators in our markets. It is a great time to be as well positioned for accretive growth as we now are,” concluded Aldag.
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 allows hospitals and other healthcare facilities to unlock the value of their underlying real estate in order to fund facility improvements, technology upgrades, staff additions and new construction. 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.
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
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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; Normalized FFO per share; projected leverage metrics; the amount of net proceeds available for debt repayment; the amount of acquisitions of healthcare real estate, if any; results from the potential sales, if any, of assets; capital markets conditions; 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 federal 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, 2015. 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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