The acquisition of Newton, MA-based senior living provider AlerisLife by ABP Acquisition LLC became effective Monday, AlerisLife announced Monday morning.
AlerisLife now is a subsidiary of ABP and is a private company.
ABP successfully completed the previously announced tender offer to acquire all outstanding shares of the common stock of AlerisLife for $1.31 per share in cash. The dollar amount per share represents an 85% premium to the 30-day average trading price prior to the tender announcement.
The tender offer expired at midnight Friday with 72.8% of the outstanding shares of ALR common stock (22,375,687 shares) having been validly tendered and not validly withdrawn from the tender offer, including the 1,972,783 shares already owned by ABP. ABP subsequently accepted all of the shares for payment.
After the tender offer closed, AlerisLife merged with and into a subsidiary of ABP, and all shares that had not been validly tendered were converted into the right to receive the same $1.31 per share in cash.
Shares of ALR common stock have stopped trading on Nasdaq, and ABP “intends to promptly cause such shares to be delisted,” AlerisLife said. “Payment will be made promptly to all former ALR stockholders regardless of whether they tendered their shares,” according to the company.
AlerisLife announced Feb. 3 that it planned to be acquired by ABP Acquisition 2 LLC for almost $44 million.
ABP Acquisition 2 LLC is a wholly owned subsidiary of ABP Acquisition LLC. ABP Acquisition LLC is a wholly owned subsidiary of ABP Trust. Adam D. Portnoy, a managing director of AlerisLife and chair of the company’s board of directors, is the sole trustee and controlling shareholder, as well as an officer, of ABP Trust.
In a letter to employees that was filed with the Securities and Exchange Commission after the planned acquisition was announced, AlerisLife President and CEO Jeffrey Leer said that Portnoy and he “agree that being privately owned rather than a publicly traded company will allow us to enhance our focus on operational excellence and put us in the best position to successfully deliver on our business and mission.”
ABP Acquisition LLC, Portnoy and ABP Trust collectively owned approximately 6.1% of the outstanding AlerisLife shares at the time of the acquisition announcement.
According to documents filed with the SEC on Monday, AlerisLife executive officers and directors disposed of the following amount of common stock:
- Leer: 433,363 shares
- Director Jennifer Clark: 122,573 shares
- Vice President and Chief Accounting Officer Stephen Geiger: 68,694 shares
- Director Gerard Martin: 60,451 shares
- Senior Vice President and Chief Financial Officer Heather Pereira: 46,476 shares
- Senior Vice President and Chief Operating Officer Philip Benjamson: 46,435 shares
- Director Barbara Gilmore: 44,075 shares (including 1,000 shares owned by her husband)
- Director Bruce Gans: 43,194 shares
- Director Donna Fraiche: 40,100 shares
Portnoy also is president and CEO of RMR Group, which provides management services to AlerisLife and real estate investment trust Diversified Healthcare Trust, the portfolio of which contained 120 AlerisLife senior living communities operating under the Five Star Senior Living name as of November.
Diversified Healthcare Trust owned approximately 31.9% of the outstanding shares of AlerisLife at the time the acquisition agreement was announced, agreed to the transaction and agreed to tender the shares that it owns into the offer.
AlerisLife rejected offers from two other entities before accepting Portnoy’s acquisition offer, according to documents filed with the SEC in February. In response to demand letters and legal complaints it received in relation to the planned sale, the company last week amended some information that it had filed with the SEC “to avoid the risk of the Tender Offer Litigation delaying or otherwise adversely affecting the transactions and to minimize the costs, risks and uncertainties inherent in defending the Tender Offer Litigation.”
AlerisLife was No. 6 on the 2022 American Seniors Housing Association’s ASHA 50 list of largest senior living operators, down from No. 5 in 2021 and No. 4 in 2020. But the company moved from No. 5 in 2021 to No. 4 in 2022 on Argentum’s list of largest operators.
