The merger agreement was unanimously approved by the board of directors of both Kindred and RehabCare. Two members of the RehabCare board will join the Kindred board when the deal is finalized.
Shareholders of St. Louis, MO-based RehabCare will get $26 per share in cash and 0.471 of a share of Kindred common stock, which the two companies said equates to about $35 per share.
“Our combination with Kindred delivers significant value to our stockholders and provides an opportunity to share in the future growth of the combined company,” RehabCare President/CEO John H. Short said. “We share the same commitment to delivering leading-edge post-acute care that improves lives, and we expect our patients, healthcare partners and professionals to benefit from the blending of our organizations.”
Kindred expects to issue approximately 12 million shares in connection with the transaction. The aggregate value of the pending transaction approximates $1.3 billion, including approximately $400 million of existing indebtedness.
The deal is expected to be finalized by June 30, but must still be approved by stockholders of both companies, and cleared by federal regulators.