The Ensign Group has set a record date of Sept. 20 for the previously announced spinoff of its subsidiary, The Pennant Group, the San Juan Capistrano, CA-based company announced Wednesday.
The spinoff will include substantially all of Ensign’s current senior living operations, plus its home health and hospice operations.
“We believe that separating these two businesses will accelerate the ability of both organizations as two distinct, but very healthy enterprises to quickly adapt to the ever-changing needs of our patients, payers and other providers within the continuum of care,” Ensign CEO Barry Port said earlier this month on Ensign’s second-quarter earnings call. “We also believe that this spinoff will shine light on value that has yet to be fully realized as a single entity and will present two very attractive investments that provide our partners and shareholders the opportunity to share and add value now and over time,” he added.
Chad Keetch, Ensign’s chief investment officer, executive vice president and secretary, said during the earnings call that even though Pennant’s ownership structure will be new, Ensign and Pennant will continue to develop a preferred provider network, called the Ensign Pennant Care Continuum.
“This will memorialize the operational partnership we have always enjoyed under one umbrella,” he said. “As preferred providers within the care continuum, each Ensign and Pennant operation that elects to be part of the network will work together to appropriately share data and create care pathways designed by our clinicians to achieve the highest possible outcomes and transitions between care settings.”
Daniel Walker, current president of Ensign’s home health and hospice holding company, Cornerstone Healthcare, will be chairman, CEO and president of Pennant. Christopher Christensen will be a director of Pennant in addition to serving as executive chairman of Ensign.
John Nackel, Ph.D., a current Ensign director, also will serve as a Pennant director; Ensign expects that he will temporarily continue his service on the Ensign board until a replacement is named or until the end of his current term, whichever occurs first.
After the spinoff, Ensign will include transitional and skilled services, rehabilitative care services, healthcare campuses, post-acute-related new business ventures and real estate investment. Port said that the company will continue to acquire properties consistent with its existing business model.
Ensign stockholders will receive one share of Pennant common stock for every two shares of Ensign common stock held as of the close of business on Sept. 20. The effective date of the distribution will be Oct. 1.
Pennant expects to list its common stock on NASDAQ under the symbol PNTG. Ensign will not retain any Pennant common stock and will continue to be listed on NASDAQ under the symbol ENSG.