HCR Manor Care
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Manor Care, Inc., through its operating group HCR Manor Care, is a major provider in the United States of both short-term post-acute and long-term care. As of 2007, it had more than 500 skilled nursing and rehabilitation centers, assisted living facilities, outpatient rehabilitation clinics, and hospice and home health care offices, and over 60,000 employees. The company is headquartered in Toledo, Ohio. In July 2007, it agreed to a $4.9 billion buyout offer from the private equity firm Carlyle Group.
The company operates primarily under the Heartland, ManorCare Health Services and Arden Courts names. In 2006, it earned $167 million on sales of $3.6 billion.
As of the end of 2006, the company operated 278 skilled nursing facilities, 65 assisted living facilities, 116 hospice and home health offices, and 92 outpatient therapy clinics, located in 30 states, primarily in Florida, Illinois, Michigan, Ohio, and Pennsylvania. About 73% of its revenue comes from higher-paying Medicare and private-pay patients.
As of the end of 2006, the company had approximately 59,500 employees, including part-time employees. About 7,100 employees were salaried; the rest were hourly employees. About 1,400 employees were members of labor unions.
In 1980, the company merged with the hotel company Quality International, later renamed Choice Hotels, which was also run by Bainum. In 1982, the company acquired nursing home operator Cenco, for $209 million; total facilities were 105, in 19 states. In 1987, Stewart Bainum, Jr., became chairman and CEO, succeeding his father.
In 1992, the company spun off Vitalink Pharmacy Services into a public company with a value of $236 million. In 1996, the company spun off Choice Hotels, refocusing its business on health care.
In 1998, Ohio-based Health Care and Retirement Corporation merged with Manor Care to become HCR Manor Care. The company headquarters was consolidated in Toledo.
In March 2000, Stewart Bainum, Jr., and a management group made separate offers to buy the company, which the company's board rejected. His term as chairman of the board ended in 2001, and in 2002 he left the Board.
2007 buyout offer
In July 2007, the company agreed to a $4.9 billion buyout offer from the private equity firm Carlyle Group; it will no longer be a publicly traded corporation. Analysts said that Carlyle was interested in the company because it owns, rather than leases, nearly all its own facilities and boasts arguably the best real-estate portfolio in the business, with generally well-maintained, newer facilities in good locations, and little mortgage debt. By borrowing against the property to finance the buyout, Manor Care and Carlyle can carry out the deal on favorable terms. The buyout was completed at $67 per share on December 21, 2007. In 2010 HCR Manorcare entered into a sale-leaseback transaction whereby the company sold off 338 post-acute, skilled nursing and assisted living facilities for $6.1 Billion . These are now owned by HCP, a REIT or Real Estate Investment Trust based within the state of California, for $6.1 billion. These assets are still operated by HCR ManorCare.
- "Corporate profile", accessed July 10, 2007
- "Carlyle to buy Manor Care for $6.3 billion: Latest health care provider to be acquired by private equity buyer"], Bloomburg, May 16, 2008
- Theo Francis, "Real Estate Is Driver Of Manor Care Buyout Deal", Wall Street Journal, July 3, 2007
- Annual report, 2006 (pdf)
- HCP to Acquire Assets of HCR Manorcare in $6.1 Billion Sale-Leaseback