GEO Group to Buy Correctional REIT

The GEO Group, a Boca Raton, Fla.-based provider of correctional and mental health services, is acquiring Palm Beach Gardens, Fla.-based CentraCore Properties Trust, a correctional real estate investment trust, for about $396 million.The purchase price includes the assumption of about $40 million of CentraCore debt. CentraCore owns 13 correctional facilities totaling 8,071 beds, of which 11 facilities totaling 6,945 beds are currently leased to GEO under sale-leaseback agreements, GEO said. Under the merger agreement, shareholders of CentraCore will receive $32 cash per common share, or about $356.1 million, and GEO will refinance CentraCore's debt, which is estimated to be $40 million, upon the expected closing of the deal in late 2006 or early 2007. The GEO Group said it plans to finance the acquisition, including fees and expenses, through the use of $57 million in cash and $360 million in debt to be arranged by BNP Paribas. The companies can be found on the Web at http://www.thegeogroupinc.com and http://www.correctionalpropertiestrust.com.