Sonida Senior Living announced the completion of its previously announced $1.8 billion merger with CNL Healthcare Properties, a public non-traded real estate investment trust focused on senior housing assets. The transaction creates a combined $3.3 billion pure-play senior housing owner-operator and establishes Sonida as the eighth-largest owner of U.S. senior living assets by unit count.
The Dallas-based company acquired 100% of CNL Healthcare Properties in a stock-and-cash transaction valued at approximately $1.8 billion. Following the merger, the combined company will continue trading under Sonida’s existing ticker symbol, SNDA, on the New York Stock Exchange.
The transaction significantly expands Sonida’s footprint, creating a portfolio of 153 owned senior living communities totaling roughly 14,700 units. These properties span independent living, assisted living, and memory care communities across the United States. The combined portfolio strengthens Sonida’s presence in the South, Southeast, and Midwest while expanding into new regions including the Mountain West, Pacific Northwest, and Mid-Atlantic.
Under the terms of the merger agreement, Sonida acquired CHP shares for a total consideration of $7.22 per share. This includes an exchange ratio of 0.1318 shares of Sonida common stock along with $2.32 in cash. The exchange ratio was calculated using a volume-weighted average price measurement period prior to closing and subject to an asymmetric collar around the reference share price.
Existing Sonida shareholders will own 50% of the newly combined company’s diluted common equity. The company expects the transaction to generate an estimated normalized FFO per share accretion of 62% on a run-rate basis.
The deal also significantly reshapes Sonida’s balance sheet and capital structure. In connection with the merger, the company secured permanent debt financing totaling $930 million with the ability to increase borrowings to $1.25 billion through an accordion feature. The financing package includes a $405 million revolving credit facility and two senior secured term loans totaling $525 million.
Additionally, Sonida drew $270 million from a previously arranged $900 million bridge loan facility to fund part of the cash portion of the acquisition and repay certain existing debt at CNL Healthcare Properties. The bridge loan is expected to be replaced with property-level financing before maturity.
The company said the combined platform is designed to capitalize on favorable demographic trends in the senior housing sector while expanding operational scale. Sonida expects to unlock operating synergies, increase liquidity in its shares, and enhance access to capital markets following the integration.
Governance of the combined company will include a nine-member board of directors. Two members designated by CNL Healthcare Properties, Stephen Mauldin and J. Chandler Martin, will join the board. Michael Simanovsky, founder and managing partner of Conversant Capital and Sonida’s largest shareholder, has been appointed board chairman.
Sonida Senior Living operates independent living, assisted living, and memory care communities across the United States. After completing the merger, the company owns, manages, or holds investments in 165 senior housing communities totaling more than 16,400 units across 35 states.
KEY QUOTES:
“We are very pleased with the strong support from both Sonida and CHP stockholders, underscoring their belief in the power of this combination and marking a significant step forward for Sonida. Moreover, the transaction is immediately accretive to shareholders and positions the company to create increased and durable value over the long term. Our owner-operator platform has been purposefully designed for growth and scale in order to fully maximize historically favorable senior housing fundamentals and powerful demographic trends. This combination accelerates that strategy by more than doubling our owned footprint and strengthening our presence in markets we believe offer the most attractive opportunities.
“As part of the transaction, all dedicated resources of CHP’s external advisor will be available to Sonida for the next 90 days. Furthermore, a number of the advisor’s employees will join Sonida in permanent roles, continuing to deepen our talent pool and aiding in the integration process. Over the last several months, we have worked closely with CHP to ensure a smooth integration and transition for its communities and employees. This includes working side-by-side with CHP’s current operating partners, pursuing deeper strategic relationships where applicable, and identifying a path forward that is beneficial to our staff, our residents, and our shareholders.”
“With the closing of this transaction, we expect to unlock substantial operating synergies, drive future NOI growth through operational improvements and portfolio optimization, increase share liquidity, and broaden the breadth and depth of our access to capital. Importantly, we remain committed to disciplined growth, both organic and inorganic, while remaining focused on our expanded opportunity and fundamental objective – providing our residents, both current and new, with the highest quality of care, attention, and services available in the market.”
“Finally, I would like to acknowledge the entire Sonida team for their persistent work, both our corporate employees for their dynamic execution on this transaction, and our frontline community employees, for their unremitting efforts to deliver the highest standards to our residents.”
Brandon Ribar, President And Chief Executive Officer, Sonida Senior Living
