Anyone got any TA hoodoo cooking? Press Release:
Wednesday March 31, 6:41 pm Eastern
Time
Company Press Release
Ventas, Inc. Filing of
Annual Report On Form
10-K For Fiscal Year Ended
December 31, 1998
LOUISVILLE, Ky.--(BUSINESS WIRE)--March 31, 1999--Ventas, Inc.
(NYSE:VTR - news) announced today that it has filed its Annual Report on
Form 10-K including the Company's audited financial statements for the year
ended December 31, 1998 with the Securities and Exchange Commission. The
report of the Company's independent accountants accompanying the audited
financial statements in the Annual Report on Form 10-K includes an
explanatory paragraph regarding the ability of the Company to continue as a
going concern.
The Company leases substantially all its properties to Vencor, Inc. (NYSE:VC -
news) and derives approximately 98.7% of its revenues from Vencor. The
operations of Vencor have been negatively impacted by changes in
reimbursement rates and census, its current level of indebtedness and certain
other factors. Vencor has announced that it will incur a significant loss for
1998. This could have a material adverse effect on Vencor's financial condition
and adversely affect its ability to make contractual and timely rental payments
to the Company. In addition, the Company has a bridge loan in the amount of
$275 million which is due on October 30, 1999, which will have to be extended,
refinanced or repaid. The Company's auditors have concluded that these matters
raise substantial doubt about the Company's ability to continue as a going
concern.
The Company has undertaken certain initiatives to address these issues. As
previously announced, the Company has retained Merrill Lynch & Co., as
financial advisor, to assist in its review of Vencor's financial condition and
ability to comply with covenants in its bank credit facility. Merrill Lynch is also
assisting the Company in its review of alternatives to repay the $275 million
portion of its credit facility that matures on October 30, 1999, and to assess
other strategic alternatives for the Company.
The Company and Vencor have discussed Vencor's recent results of operations
and Vencor's need to amend or restructure its existing indebtedness. In those
discussions, Vencor has requested interim rent concessions under its leases with
the Company, and the Company has rejected that request. The Company will
consider further proposals from Vencor and take actions that may be in the best
interest of the Company. In addition, the Company announced that it has entered
into an agreement with Vencor whereby the Company has agreed not to
exercise remedies for non-payment of rent due from Vencor on April 1, 1999
for a period ending April 12, 1999. However, there are currently no
agreements or understandings with respect to modifications of any terms of the
leases.
Ventas, Inc. is a real estate company whose properties include 219 nursing
centers, 45 hospitals and eight personal care facilities operated in 36 states.
This press release includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the ''Securities Act''),
and Section 21E of the Securities Exchange Act of 1934, as amended (the
''Exchange Act''). All statements regarding the Company's expected future
financial position, results of operations, cash flows, financing plans, business
strategy, expected lease income, plans and objectives of management for future
operations and statements that include words such as ''anticipate,'' ''believe,''
''plan,'' ''estimate,'' ''expect,'' ''intend,'' and other similar expressions are
forward-looking statements. Such forward-looking statements are inherently
uncertain, and stockholders must recognize that actual results may differ from
the Company's expectations.
Factors that may affect the plans or results of the Company include, without
limitation, (i) the ability of the Company's operators to maintain the financial
strength and liquidity necessary to satisfy their obligations and duties under
leases and other agreements with the Company and their existing credit
agreements, (ii) the extent of future healthcare reform and regulation, including
cost containment measures and changes in reimbursement policies and
procedures, (iii) increases in the cost of borrowing for the Company, (iv) the
ability of the Company's operators to deliver high quality care and to attract
patients, and (v) the ability of the Company to pay and/or refinance its
indebtedness as it becomes due. Many of such factors are beyond the control of
the Company and its management.
In addition, please note that certain information contained in this press release
has been provided by the Company's primary tenant, Vencor. Vencor is subject
to the reporting requirements of the Securities and Exchange Commission (the
''Commission'') and is required to file with the Commission annual reports
containing audited financial information and quarterly reports containing
unaudited financial information. Although Vencor has provided certain
information to the Company, the Company has not verified this information
either through an independent investigation or by reviewing Vencor's Annual
Report on Form 10-K for the year ended December 31, 1998, which as of
March 30, 1999 had not been filed with the Commission. The Company has no
reason to believe that such information is inaccurate in any material respects,
but there can be no assurances that all such information is accurate.
Contact:
Ventas Inc., Louisville
Steven T. Downey, 502/357-9030
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