Genesis Healthcare sells 51% stake in Chinese subsidiary
Genesis HealthCare announced that it has signed a definitive agreement to sell 51% of its subsidiary in China, referred to as GRS-HS, to Riswein Health Industry Investment Co., Ltd for $30M. The transaction is expected to close in Q1 of 2019 and is subject to regulatory and licensing approvals, and other customary conditions. In the coming weeks, GRS-HS will seek approval for a new, wholly owned foreign entity (WOFE) in China. GRS-HS expects the process to take about 9 months to complete. Upon formation of the WOFE, Riswein will invest $30M for a 51% stake in the WOFE and GRS-HS will own the remaining 49%. In the interim, Riswein will lend GRS-HS $5M, which will fund operating expenses during the WOFE approval process. Riswein and GRS-HS will use the $30M to further fund expansion in China.