Washington Post Article – For Carlyle, HCR/ManorCare a Deal on Demographics
By Thomas Heath and Michael S. Rosenwald
Washington Post Staff Writers
Monday, July 9, 2007; Page D01
Private-equity firms have been picking off companies faster than bankers can draw up the papers. The targets are varied: Clear Channel Communications, Equity Office Properties, Harrah’s Entertainment, the Hilton Hotel chain.
And now, nursing homes.
Carlyle Group’s $6.3 billion purchase last week of HCR Manor Care has turned a few heads, with some wondering why one of the world’s top private-equity firms is following up a major deal for part of Home Depot by hooking up with the infirm and elderly.
The answer, Carlyle Group’s strategists say, is baby boomers, particularly the more than 60 million boomers preparing to retire.
“You are taking advantage of the favorable demographics,” said Karen H. Bechtel, a Carlyle Group managing director who heads its health-care practice. “We believe this is really coming. You are going to serve more patients and have the capability to serve more patients and improve your business.”