Sienna Senior arranges $175-million debenture offering

Executive Summary

• Sienna Senior Living Inc. announced a $175 million offering of 4.112% Series E Senior Unsecured Debentures maturing in August 2030, with net proceeds designated for debt repayment, acquisitions, development, and general corporate purposes.
• The company simultaneously completed the acquisition of Credit River Retirement Residence for $60.2 million, a 133-suite facility in Streetsville, Ontario, which is expected to be immediately accretive to adjusted funds from operations per share.
• The debenture offering is being managed by a syndicate led by BMO Nesbitt Burns, TD Securities, and CIBC Capital Markets, subject to a minimum credit rating of BBB with a stable trend.

Key Details

• Financing Structure:
  • Instrument: Series E Senior Unsecured Debentures.
  • Principal Amount: $175 million.
  • Interest Rate: 4.112% per annum.
  • Maturity Date: August 21, 2030.
  • Issue Price: Par.
  • Agents: Syndicate co-led by BMO Nesbitt Burns Inc., TD Securities, and CIBC Capital Markets as joint lead agents and bookrunners.
  • Basis: Best effort agency basis.
  • Closing Date: Expected on or about August 21, 2025, subject to customary conditions.
  • Rating Condition: Must be rated at least BBB with a stable trend by Morningstar DBRS.
  • Use of Proceeds: Repay existing indebtedness, finance acquisitions, finance developments, and general corporate purposes.
  • Jurisdiction: Private placement in each of the provinces of Canada.
• M&A Transaction:
  • Target: Credit River Retirement Residence.
  • Location: Streetsville, Ontario (Greater Toronto Area).
  • Size: 133-suite retirement residence.
  • Purchase Price: $60.2 million.
  • Yield: Initial investment yield of 5.75%.
  • Valuation Note: Completed at a discount to replacement cost.
  • Operational Expectations: Anticipated stabilized occupancy of 95% within the first year of operations; expected to be immediately accretive to adjusted funds from operations per share.
  • Strategic Rationale: Synergies expected due to numerous existing properties owned by Sienna in the GTA.

Notable Quotes

• "Sienna's debenture offering puts us in a strong position to pursue our continued growth plans," said Nitin Jain, president and chief executive officer. "We are excited that the offering coincides with the completion of another high-quality acquisition. Both transactions further strengthen our company at a time when Canada's aging population and limited new construction of senior living residences are expected to generate sustained demand for years to come."