Leisureworld Senior Care Corporation

Leisureworld Senior Care Corporation

May 24, 2012 16:25 ET

Leisureworld Announces Completion of Acquisition of Three Luxury Retirement Residences

MARKHAM, ONTARIO--(Marketwire - May 24, 2012) -


Leisureworld Senior Care Corporation (the "Company") (TSX:LW) today announced that it has completed its previously announced acquisition of three luxury retirement residences in the Greater Vancouver Area in British Columbia (the "Acquisition"). The three luxury retirement living properties feature top quality amenities and are competitively positioned in attractive markets. The properties, which together are comprised of 392 suites, grow the Company's asset base by approximately 16% and mark the Company's entrance into the British Columbia seniors housing market, further diversifying the Company's portfolio of retirement residences and long-term care homes.

The purchase price of $119.8 million was subject to various adjustments and holdbacks including a working capital adjustment of $1.3 million and holdbacks of an aggregate $4.1 million (including a holdback of $2.0 million to be held in escrow as an income guarantee to complement cash flow from one of the properties during its lease-up period). The vendor will have the ability to earn up to an additional $6.0 million should the net operating income of two of the properties exceed targets over the next twelve months.

The purchase price was satisfied, in part, by the assumption of a mortgage having a principal amount of $23.6 million at a fixed interest rate of 5.18% maturing in 2017, a new $26.0 million two-year term loan and a $26.1 million one-year term loan, each at a floating rate equal to the bankers' acceptance rate plus 187.5 basis points, and the issuance of 82,988 common shares of the Company to the vendor for $1.0 million. The balance of the purchase price was funded from the net proceeds of the Company's recently completed public offering of subscription receipts. On closing of the Acquisition, one common share was automatically issued in exchange for each outstanding subscription receipt, resulting in the issuance of 4,680,500 common shares.

The securities offered pursuant to the subscription receipt offering have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act. This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction.

About Leisureworld Senior Care Corporation

Leisureworld is the third largest licensed long-term care (LTC) provider in Ontario. The Company owns and operates 26 LTC homes, representing 4,314 beds across Ontario, Canada. Leisureworld also owns and operates six retirement residences comprising 715 suites and one independent living residence with 53 apartments. Leisureworld subsidiary entities include: Preferred Health Care Services, an accredited provider of professional nursing and personal support services; and Ontario Long Term Care, a provider of purchasing services, and dietary, social work, and other regulated health professional services.

Forward-Looking Statements

Certain of the statements contained in this news release are forward-looking statements and are provided for the purpose of presenting information about management's current expectations and plans relating to the future. Readers are cautioned that such statements may not be appropriate for other purposes. These statements generally use forward-looking words, such as "anticipate", "continue", "could", "expect", "may", "will", "estimate", "believe" or other similar words and include, among other things, statements related to the use of the income guarantee to complement cash flow. Although management believes that it has a reasonable basis for the expectations reflected in these forward-looking statements, actual results may differ from those suggested by the forward-looking statements for various reasons. Unanticipated events and risk factors could cause actual results to differ materially from the results and events discussed in the forward-looking statements. These forward-looking statements reflect current expectations of the Company as at the date of this news release and speak only as at the date of this news release. The Company does not undertake any obligation to publicly update or revise any forward-looking statements except as may be required by applicable law.

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