LONG BEACH, CA-Healthcare properties REIT HCP has priced its new offering of 30 million shares at $36.90 for a total of more than $1.1 billion to fund part of its previously announced $6.1 billion purchase of 338 facilities from Toledo, OH-based HCR ManorCare.

HCP says the deal was upsized from the originally announced 24 million shares due to strong investor demand. The underwriters also have an option to purchase up to 4.5 million additional shares of common stock, exercisable within 30 days.

The portion of the HCR ManorCare acquisition to be funded from the offering will include $852 million to fund all of the stock portion of the consideration in cash in lieu of issuing 25.7 million shares of HCP common stock to HCR ManorCare. Any additional net proceeds will be used for general corporate purposes.

The deal will give HCP 338 post-acute, skilled nursing and assisted living facilities “located in strong markets with high barriers to entry,” HCP says. The facilities are located in 30 states, with the highest concentrations in Ohio, Pennsylvania, Florida, Illinois and Michigan.

HCR ManorCare and its affiliates will continue to operate the assets under a long-term triple-net master lease supported by a guaranty from HCR ManorCare. In addition, the agreement grants HCP an option to acquire a 9.9% interest in HCR ManorCare for an additional purchase price of $95 million.

BofA Merrill Lynch is acting as sole book-running manager for this offering, which is expected to close on March 28, subject to customary closing conditions.