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The Ensign Group Inc., a Mission Viejo nursing home operator, is planning to split itself into two publicly traded companies.
Ensign’s operating group will provide long-term care, rehabilitation, hospice and other specialty healthcare services and retain the Ensign name.
Ensign said in the statement that it was separating into two companies out of a “position of strength” rather than necessity. Shares of Ensign are up 48% since the start of 2013.
The second company will own all of Ensign’s real estate under the name CareTrust REIT Inc.
Ensign Chief Executive Christopher Christensen said the Ensign-CareTrust separation will be structured “in a way that safeguards our ability to provide the highest-quality healthcare services and continue our successful business model.”
Ensign said in a release that it would separate the companies through distributing common stock of the REIT to its current shareholders. Ensign said it expects the deal to be complete in next year’s first quarter.
Gregory Stapley, currently Ensign’s executive vice president and secretary, will become CareTrust’s chief executive after the separation.
Ensign shares were up 5% in midday trading today to a market value of about $962 million. The deal was announced Thursday after market close.