Medical Properties Trust (MPT) has sealed a $1.7 billion equity recapitalization and debt financing of a portfolio of eight general acute care inpatient hospitals in Massachusetts, the company announced.
Apollo provided a loan of around $920 million as part of the deal, sources said.
MPT has formed a joint venture with Macquarie Infrastructure Partners Va private fund managed by Macquarie Asset Management (MAM), to form a partnership whereby a subsidiary controlled by MAM acquired a 50% interest in the portfolio, which is operated by Steward Health Care System.
Hospitals are located in Brighton, Methuen, Haverhill, Brockton, Fall River, Taunton, Ayer and Dorchester.
“At MPT, we have long understood the intrinsic value of our entire portfolio as well as the skill of operators such as Steward,” Edward K. Aldag, president and CEO of MPT, said in a statement. “The closing of this transaction provides independent confirmation of the value that sophisticated investors and lenders also attribute to well-underwritten hospital investments.”
CBRE advised MPT in the search for a new financial partner to recapitalize the assets, and also arranged the debt of the newly formed joint venture.
Keith Harris of CBRE’s operational real estate group, based in London, in partnership with Lee Asher, Chris Bodnar, ryan lindsley and Jordan Selbiger from CBRE’s US healthcare and life sciences capital markets group to advise MPT on asset recapitalization.
CBRE Debt Advisory Specialist James Millon arranged the financing of the new joint venture.
Including non-recourse debt, total cash proceeds to MPT were approximately $1.3 billion, substantially all of which was used to repay debt.
“This was a rare opportunity for an investor to partner with MPT to recapitalize the largest portfolio of acute care hospitals to come to market,” Asher said. “These are unique hospital assets in Massachusetts’ critical healthcare markets, and we believe the newly formed joint venture will successfully support Steward’s hospital operations and its mission to provide the highest quality care to his patients.”
Apollo officials declined to comment.
Emily Fu can be reached at [email protected].