Merger activity increased last week with six new deals announced and six deals completed. Three of the six new deals announced were potential deals in the works.
Healthcare Trust of America (HTA)
Founded in 2006, Healthcare Trust of America is a healthcare focused REIT and the largest operator of dedicated medical office buildings (MOB) in the United States. The company owns real estate though 461 on-campus and off-campus properties around hospitals and Universities in 32 states. We added HTA to our ‘Deals in the Works‘ tool on October 6, 2021, when Bloomberg reported that activist investor Elliott Investment Management was pushing for the company to launch a strategic review that included a potential sale of the company. The price of HTA was $30.02 before the announcement. On February 28, 2022 HTA announced that it is combining with Healthcare Realty Trust Incorporated (HR) in a cash plus stock deal.
We wrote the following about HTA for our October 2021 Mid-Month Update:
HTA has performed admirably through the COVID-19 pandemic as demand for medical office buildings remained strong. While other REITs, like those focused on retail and office buildings, took big hits to their earnings and cut dividends, HTA managed to increase its funds from operations (FFO) and dividends through the pandemic as you can see from the FFO chart below. REITs like to use Funds From Operations (FFO) because it removes the impact of depreciation as an expense, which can be quite large for real estate focused companies. It also removes any gains and losses from the sale of certain real estate assets or change of control of certain assets.