Tenet delays Conifer spinoff by 1 year

Dallas-based Tenet Healthcare is delaying the spinoff of Conifer, its revenue cycle subsidiary, by 12 months, the company said in its fourth-quarter earnings presentation Feb. 10.

Tenet expected to complete the spinoff of Conifer into a separate publicly traded company in the second quarter of this year. 

However, the process will take another year, as COVID-19 created some delays, according to the presentation. 

"It's still going to occur. In the scheme of things, it is not a big delay. It will give us an opportunity to get past COVID and be prepared to do this in a much more effective manner," said Ron Rittenmeyer, Tenet executive chair and CEO.

In 2020, Tenet worked to position Conifer for a successful spinoff by working to increase margins and hiring external talent for key roles, including its CEO, COO and chief consumer officer. Conifer's margins increased to 28.1 percent in 2020, up from 17.7 percent in 2017. 

Tenet initially tried selling the business, but leaders said the offers it received for the company were underwhelming, especially given the revenue cycle company's improved performance since 2017. 

One analyst asked Tenet officials during the presentation if the company would consider selling the company rather than spinning it off if it received another offer. Mr. Rittenmeyer said he would consider it. 

"We're a public company. We have to consider whatever comes forward," Mr. Rittenmeyer said. "That's just the nature of the business."

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