SENIOR LIVING FIRM BUYS TIME TO STRUCTURE NEW LONG-TERM FINANCING DEAL
By Murray W. Wolf
When a market leader like General Motors Corp. (NYSE: GM) teeters on the edge of bankruptcy, it stokes concerns about the entire automotive industry.
The same might be said of the senior living business, where bankruptcy could loom for the largest operator in that sector, Sunrise Senior Living Inc. (NYSE: SRZ).
It’s not a perfect analogy, however. Although the future could be rocky for Detroit automakers, most analysts agree that the long-term prospects for the senior living sector remain fundamentally strong. And Sunrise was recently given more time to negotiate a financial restructuring that could help it avoid bankruptcy.
Sunrise buys time
Even so, Sunrise faces a daunting task. The firm lost nearly $440 million last year, including almost $306 million during the fourth quarter of 2008 (Q4) alone. The company closed one subsidiary, sold another and has halted development on 215 projects.
With dwindling cash reserves and significant debt maturing this year and next, Sunrise officials said March 2 that the firm might need to seek bankruptcy protection if it could not reach new agreements with lenders by the end of the month.
The full content of this article is only available to paid subscribers. If you are an active subscriber, please log in. To subscribe, please click here: SUBSCRIBE
Comments are closed, but trackbacks and pingbacks are open.