Ventas seeks damages from Sunrise Senior Living for breach of purchase agreement; deal still on

By Lisa Kerner

Charlotte, N.C., April 5 - Ventas, Inc. is seeking unspecified damages from Sunrise Senior Living Real Estate Investment Trust in the Ontario Superior Court of Justice.

The damages are the result of breaches by Sunrise of its standstill enforcement obligations in the purchase agreement between Ventas and Sunrise, according to a company news release.

Ventas does not want to terminate the purchase agreement and intends to close on the purchase of Sunrise.

However, Sunrise said it believes the legal action is "without merit" and the company plans to "vigorously defend" the litigation.

In March, the Ontario Court of Appeal upheld an earlier decision declaring that Sunrise must comply with its covenants in its purchase agreement with Ventas to enforce Sunrise's rights under its confidentiality agreement with Health Care Property Investors, Inc.

The court also upheld Ventas' request for a declaration that the standstill terms in the confidentiality agreement between Sunrise and Health Care Property are in effect, a news release stated.

Health Care Property's several offers, all since withdrawn, are considered breaches of its standstill agreement with Sunrise. The Health Care Property standstill agreement prohibits it from making any proposal to acquire any assets of Sunrise through May 2008.

Under its Jan. 15 agreement with Sunrise, Ventas will acquire the interest in 74 of Sunrise's private-pay senior living communities in the United States and Canada in a transaction valued at $1.8 billion, or C$15.00 cash per unit.

Ventas is a Louisville, Ky., health care real estate investment trust.

Toronto-based Sunrise was formed to indirectly acquire and own senior living communities.

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