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Ventas Goes to Court for Sunrise Acquisition

TORONTO-The healthcare REIT asks Ontario Superior Court to force Sunrise Senior Living REIT to comply with their purchase agreement and enforce a standstill agreement with Health Care Property Investors.

By Brian K. Miller | Updated on February 22, 2007

TORONTO-Healthcare REIT Ventas Inc. of Louisville, KY filed an application with Ontario Superior Court this week demanding that locally based Sunrise Senior Living REIT comply with their purchase agreement and enforce its standstill agreement with Health Care Property Investors. HCPI dropped out of the original competition for Sunrise and, after Sunrise signed a purchase agreement with Ventas at C$15 per share, now is trying to trump the deal with a C$18 bid.

As outlined in separate letters submitted to Sunrise REIT and to HCPI on Feb. 20, 2007 (and filed with the SEC this week), the HCPI confidentiality and standstill agreement from the original competition contains provisions that prohibit HCPI from, among other actions, making any proposal to acquire any securities or all or any assets of Sunrise REIT, and remains in effect for a period of 18 months, ending in May 2008. Ventas also informed HCPI that it intends to avail itself of all of its rights in respect of HCPI’s breaches of its confidentiality and standstill agreement.

Aside from the fact that it should be allowed because of the aforementioned prohibitions, Ventas says HCPI’s bid is modeled after the binding agreement Ventas negotiated with Sunrise Inc. but “requires Sunrise Inc. to accede to certain provisions significantly less favorable to Sunrise Inc. than those to which Ventas agreed.” HCPI has not yet responded to the statement.

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