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BIRMINGHAM, Ala. - Medical Properties Trust, Inc. (NYSE: NYSE:MPW), a self-advised real estate investment trust specializing in hospital facilities, has initiated a private offering to raise up to $2.0 billion in senior secured notes due 2032, alongside €500 million in aggregate principal amount of similar notes due the same year. The company, currently valued at $2.67 billion by market capitalization, maintains a significant 7.19% dividend yield according to InvestingPro data. The company disclosed this strategy on Monday, with the intent to allocate the net proceeds towards redeeming its existing senior notes maturing in 2025 and 2026, and to address other general corporate purposes.
The notes, which will be backed by a diversified pool of 167 properties in the U.S., U.K., and Germany, will be guaranteed by the company and certain subsidiaries. The guarantees are secured by first-priority liens on equity of the company’s subsidiaries that own or ground lease these properties. Additionally, Medical Properties Trust anticipates amending its senior revolving credit and term loan agreement to share the collateral and guarantees proportionately and to adjust financial covenants accordingly. Analysis from InvestingPro shows the company maintains strong liquidity with a current ratio of 5.8, indicating sufficient assets to cover short-term obligations.
This offering is targeted at qualified institutional buyers in the United States, and to non-U.S. persons in offshore transactions, in compliance with the Securities Act of 1933. The securities will not be registered under the Securities Act or any state securities laws, and cannot be offered or sold within the United States absent registration or an exemption from the registration requirements.
Medical Properties Trust, founded in 2003 and based in Birmingham, Alabama, has significantly expanded its portfolio to become a leading owner of hospital real estate. As of September 30, 2024, the company owns 402 facilities with around 40,000 licensed beds across nine countries. The company generated revenue of $660.17 million in the last twelve months, and InvestingPro analysis reveals over 8 additional key insights about the company’s performance and prospects, available in their comprehensive Pro Research Report.
The press release also contains forward-looking statements that involve known and unknown risks and uncertainties that may affect the company’s actual results or future events. These include the successful completion of the notes offering, the anticipated restructuring outcomes, property sales, and capital transactions. The company cautions readers not to rely on these forward-looking statements as predictions of future events.
This news article is based on a press release statement from Medical Properties Trust, Inc.
In other recent news, Medical Properties Trust has been in the spotlight due to several key developments. The company reported a GAAP net loss of $1.34 per share for the third quarter of 2024, while its normalized funds from operations stood at $0.16 per share. Furthermore, the company highlighted asset sales totaling around $2.9 billion year-to-date, aimed at enhancing liquidity and financial flexibility.
Medical Properties Trust also announced a settlement with Viceroy Research, concluding a defamation lawsuit, although the specifics of the agreement remain undisclosed. Additionally, the company’s tenant, Prospect Medical (TASE:PMCN) Group, initiated a Chapter 11 restructuring, which has led to a decrease in rent payments to Medical Properties Trust.
On the analyst front, Truist Securities revised its price target on shares of Medical Properties Trust to $4.00, a decrease from the previous target of $6.00, and maintained a hold rating on the stock. The firm noted the company’s significant amount of maturing debt and higher cost of capital as potential challenges.
In a strategic move, Medical Properties Trust entered into a definitive agreement with Astrana Health for a deal valued at about $745 million, including the sale of the majority of Prospect’s managed care platform. The company expects to net around $200 million in cash proceeds after settling debts and other liabilities, with the majority of the cash proceeds anticipated in the first half of 2025. These are recent developments and will continue to shape the company’s trajectory in the near future.
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