American Healthcare REIT Inc., a non-traded real estate investment trust formerly known as Griffin-American Healthcare REIT IV Inc., has completed its merger with Griffin-American Healthcare REIT III Inc. in a stock-for-stock transaction that created a combined company with approximately $4.2 billion in healthcare real estate assets.
In conjunction with the merger, the REIT became self-managed following the acquisition of American Healthcare Investors, the co-sponsor of both REITs. Each of the more than 100 employees of American Healthcare Investors, including its three founders, have become employees of the newly combined company.
As a result, American Healthcare REIT’s management platform has capabilities across acquisitions, asset management, finance, accounting and tax, which the company expects to result in operational cost savings of approximately $21 million annually.
“We are pleased to have completed this merger and are excited about the future prospects of American Healthcare REIT,” said Danny Prosky, chief executive officer and president. “As a large, diverse, and self-managed healthcare REIT, we believe we are strategically positioned to pursue a future listing or IPO on a national stock exchange that would provide liquidity to our existing stockholders and unlock greater growth and value enhancement opportunities as a publicly traded company.”
Shareholders of both REITs voted on the merger proposal at their respective annual meetings held on September 30th. Approximately 104.6 million shares of Griffin-American III voted in favor of the proposal, 2.5 million voted against, and 4.4 million abstained. Approximately 44.6 million shares of Griffin-American IV voted in favor of the proposal, 929,000 voted against, and 2.2 million abstained.
As previously reported, Griffin-American Healthcare REIT III stockholders received 0.9266 of a share of Griffin-American Healthcare REIT IV common stock for each share they own.
Griffin-American Healthcare REIT III stockholders own approximately 65.2 percent of American Healthcare REIT, Griffin-American Healthcare REIT IV stockholders own approximately 29.7 percent, the management team owns approximately 2.3 percent, and other sellers in the American Healthcare Investors acquisition own approximately 2.8 percent.
Griffin-American Healthcare REIT III launched its initial public offering in February 2014 and closed in March 2015 after raising more than $1.9 billion. Griffin-American Healthcare REIT IV commenced its initial public offering in February 2016 and raised $754.1 million in investor equity prior to closing the offering in February 2019.
American Healthcare REIT’s 19 million-square-foot portfolio of healthcare real estate is comprised of 312 medical office buildings, senior housing communities, skilled nursing facilities and other real estate-related investments across 36 states and the United Kingdom.