Kindred Healthcare has completed the sale of 12 long-term acute care hospitals for $27.5 million to a group of entities operating under the name Curahealth, which are affiliates of a private investment fund sponsored by Nautic Partners. The hospitals have a total of 783 licensed beds in Arizona, Louisiana, Massachusetts, Oklahoma, Pennsylvania and Tennessee.
For the current fiscal year, Kindred expects that the hospitals will generate combined revenues of approximately $215 million and break even in terms of profit. Combined, the hospitals have $14 million of annual rent expense.
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Kindred nearned around $21 million in cash proceeds from the sale, with the remainder of the purchase price to be paid when other post-closing conditions are met. The company had amended various master lease agreements with Ventas in April 2016 in connection with the Curahealth transaction.
The transactions with Curahealth and Ventas are also expected to generate future cash income tax benefits for Kindred in the vicinity of $37 million. The company anticipates reporting pretax charges of approximately $54 million related to the Ventas lease amendments, and about $45 to $55 million related to the transaction with Curahealth within the fiscal year. Of the latter, close to $8 million was recorded during the six months ending June 30.
Kindred President and CEO Benjamin Breier said in a statement that the transaction creates both strategic and financial value for the company.