(Reuters) – Medical Properties Trust said on Friday it would sell majority of its stake in five Utah hospitals for $886 million, sending its shares up more than 10% in extended trading.
The real estate investment trust (REIT) said it had sold 75% of its stake to a newly formed joint venture.
Along with the sale, the joint venture placed new non-recourse secured financing, providing $190 million of additional cash to Medical Properties.
Non-recourse loans are extended to properties and projects that are pledged as collateral and borrowers are not held liable in the case of defaults.
The two transactions delivered about $1.1 billion of immediate cash proceeds to the company, and they will be used to reduce outstanding debt, including payment in full of its $300 million Australian term loan due 2024, the REIT said.
“We are now confident that we will exceed our initial target of $2 billion in liquidity transactions in 2024 based on the valuations achieved on recent transactions and the terms we are actively negotiating for additional transactions,” CEO Edward Aldag said in a statement.
(Reporting by Christy Santhosh in Bengaluru; Editing by Maju Samuel)
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