S&P affirms Leisureworld

Standard & Poor's said it affirmed Leisureworld Senior Care LP's A- senior secured debt rating following its announcement that it would acquire a portfolio of seven Ontario long-term care homes from Counsel Corp.

The acquisition price is C$67 million plus transaction and refurbishment costs. The company has established a C$75 million credit facility in connection with the acquisition, according to S&P.

Leisureworld's senior management said it would evaluate the long-term capital structure of the company and possibly establish a new limited partnership to hold all or part of the acquired homes, the agency said. The company expects an equity contribution of up to C$15 million may in the 12 months after the deal closes.

Further supporting the rating is Leisureworld's strong senior management, which will integrate the new homes into Leisureworld's portfolio, S&P said.

The initial rating incorporated expectations that the company would make additional acquisitions within the fragmented Ontario long-term care industry, the agency said. The rating further reflects the limits on Leisureworld's additional business activities, S&P said.

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