The county is interested in acquiring the pair of financially struggling California hospitals — San Jose-based O’Connor Hospital and Gilroy-based St. Louise Regional Hospital — as public institutions. County Executive Jeff Smith said the county views a potential acquisition as a way to relieve overcrowding at its San Jose-based Santa Clara Valley Medical Center.
The county’s interest comes after Verity Health said July 9 it is exploring strategic options, including a potential sale, to minimize financial and operational pressures at its six hospitals. Verity posted an operating loss of $55.8 million in the nine months ended March 31, according to The Mercury News.
In 2015, Verity was sold to a New York City-based hedge fund for $260 million, a historic price tag for nonprofit hospital transactions in the state. In July 2017, billionaire entrepreneur Patrick Soon-Shiong‘s, MD, company NantWorks acquired a majority stake in the hedge fund’s Integrity Healthcare, which manages Verity Health. Dr. Soon-Shiong also served as CEO of the health system from July 2017 until earlier this year.
Alyssa Rege contributed to this article.
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