Medical Properties Trust’s $859 Million Acquisition and Lease Back of Premier Australian Hospital Portfolio


Arnold Bloch Leibler (ABL) has acted for Medical Properties Trust (MPT) on the deal

Medical Properties Trust, Inc. (NYSE: MPW), has entered into definitive agreements under which the Company will acquire 11 Australian hospitals from affiliates of Healthscope Ltd. for an aggregate purchase price of approximately $859 million, and lease the acquired real estate back to Healthscope. In a related transaction, Brookfield Business Partners L.P. (NYSE:BBU) (TSX:BBU.UN) together with its institutional partners have agreed to acquire up to 100% of Healthscope’s outstanding shares. The MPT acquisitions are conditioned upon the successful completion of the Brookfield transactions.

The 11 separate hospitals are concentrated in large metropolitan areas in Australia, and will be leased pursuant to master leases that have an average initial term of 20 years with annual fixed escalations and multiple extension options. The master lease agreements also include provisions for MPT to invest up to an additional $350 million for expansion and redevelopment projects in 2019 and future years.

MPT expects to fund the transactions with a combination of existing cash balances, including approximately $200 million in net proceeds from recent issuance of common shares, and an undrawn $1.3 billion revolver under the Company’s credit facility. The transactions are expected to close in the second quarter of 2019, subject to Healthscope shareholder approval, certain governmental consents and other customary closing conditions.

Arnold Bloch Leibler (ABL) has acted for Medical Properties Trust (MPT) with a team including Jonathan Wenig (Picture) and Senior Associate Scott Phillips (Corporate & Commercial); Partner Ben Mahoney (Banking and Finance), and Partner Ken Gray and Senior Associate Dorian Henneron (Property & Development).

Involved fees earner: Ken Gray – Arnold Bloch Leibler; Dorian Henneron – Arnold Bloch Leibler; Ben Mahoney – Arnold Bloch Leibler; Scott Phillips – Arnold Bloch Leibler; Jonathan Wenig – Arnold Bloch Leibler;

Law Firms: Arnold Bloch Leibler;

Clients: Medical Properties Trust, Inc. ;

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Author: Michael Patrini