Hunt Valley-based Omega Healthcare Investors completes $600 million acquisition of a real estate trust

Omega Healthcare Investors Inc. has completed its $600 million acquisition of MedEquities Realty Trust Inc., the companies announced.

The deal adds 34 properties, mostly skilled nursing care facilities, to Hunt Valley-based Omega’s health care-focused real estate portfolio of 891 properties in 41 states and the United Kingdom. Nashville, Tenn.-based MedEquities’ properties were located in seven states and operated by 11 different companies.


“We are even more excited by this transaction today than when we announced it a few months ago,” Omega CEO Taylor Pickett said in a statement. “We’ve had an opportunity to speak with each of the operators and we look forward to working with them and potentially expanding our relationships.”

The cash and stock deal converted each MedEquities share into the right to receive 0.235 of an Omega share plus $2 cash. MedEquities also paid a special cash dividend of 21 cents per share to its common shareholders.

Omega shares closed down 79 cents Monday afternoon at $36.61 each.

Omega, which has been growing by acquisition, reported earlier in May that it earned $72.2 million, or 34 cents per share, in its first quarter. That’s down slightly from the $87.9 million, or 42 cents per share, it made in the January-to-March period of 2018. Revenue grew 1.6 percent to $223.7 million.

Funds from operations, a commonly followed indicator among real estate investment trusts, dipped 2.2 percent to $144.1 million.

During the quarter, Omega resolved a thorny legal issue involving the bankruptcy of one of its operators, Orianna Health Systems of Texas. Omega had acquired Orianna’s nursing facilities in 2013 and leased them back to the company. Orianna filed for a Chapter 11 bankruptcy reorganization last year

In January, Omega extricated itself from the leases by selling the properties back to Orianna for $176 million.