Executives at Brookdale Senior Living have filed papers with the Securities and Exchange Commission that would enable the Brentwood-based company to sell up to $1 billion worth of stock or debt securities.
Brookdale’s shelf registration statement also includes up to 16.3 million shares that are eligible to be bought by real estate investment trust Ventas in coming years. Brookdale and Ventas late last month signed a major amendment to their deal covering 120 Brookdale properties. That agreement called for some up-front payments, the warrants and more in return for rent savings that will total $500 million over the next five years. Per that agreement, Brookdale needed to register those warrants and the associated shares shortly after filing its second-quarter report.
Don’t look for the leaders of Brookdale to take advantage of their new shelf soon: The company finished the second quarter with total liquidity of about $600 million, and CFO Steve Swain on Tuesday told analysts and investors his team is laser-focused on preserving cash where it can, including by limiting property renovations and other capital expenditures.
“The bottom-line liquidity of the company is something that I'm watching,” Swain said on a conference call. “And I'm very proactive about keeping [it] under control.”
Shares of Brookdale (Ticker: BKD) were down slightly to $2.88 around noon Thursday. They began 2020 at about $7.25 and bottomed out at $1.47 during the spring.