CareTrust REIT (CTRE) M&A Announcement summary

Deal rationale and strategic fit

• Entry into the U.K. care home market leverages favorable demographics, undersupplied bed capacity, and market fragmentation, providing a high-quality, diversified portfolio of 137 homes with long-term, inflation-linked leases.

• The acquisition offers a new growth engine outside the U.S., with opportunities for expansion through existing and new operator relationships and a proven track record of growth via acquisitions and asset management.

• Enhanced portfolio diversification by geography, asset class, and operator, reducing reliance on U.S. skilled nursing.

Financial terms and conditions

• All-cash offer of $1.39 (GBP 1.08) per share, valuing equity at $577 million and enterprise value at $817 million, including $240 million net debt.

• Represents a 32.8% premium to the prior closing price and 28.1% premium to 12-month VWAP.

• Initial yield on investment is approximately 8.1% based on annual contractual rent.

• Expected accretion in year one: 6% to normalized FFO and 3% to normalized FAD, depending on financing mix.

• Financing scenarios range from 100% debt to 100% equity; current 10-year debt cost is around 6%, with $1.2 billion revolver capacity available.

Synergies and expected cost savings

• Enhanced diversification: U.S. skilled nursing property concentration drops from 77% to 49% (by property count) and from 78% to 63% (by rental income).

• Portfolio benefits from robust rent coverage (2.2x EBITDA) and high occupancy (89%).

• Pro forma portfolio will benefit from increased scale and diversification, supporting future growth.