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For-profit hospital operator M&A update: 17 latest deals involving CHS, Tenet, HCA and LifePoint

Four of the largest for-profit hospital operators have each entered into several transactions in recent months. Some of the companies are selling off facilities to strengthen their hospital portfolios, while others are exploring ways to expand their reach.

Here's a breakdown of the transactions the for-profit hospital companies have entered into so far this year.

Community Health Systems

After selling off 30 hospitals in 2017, Franklin, Tenn.-based Community Health Systems announced late last year it intends to sell a group of hospitals with combined revenue of $2 billion. The company has already made significant progress toward that goal.

CHS completed the sale of Bayfront Health Dade City (Fla.) to Altamonte Springs, Fla.-based Adventist Health System on April 1. In June, CHS divested four Tennessee hospitals and one Louisiana hospital. The company completed the sale of 425-bed Munroe Regional Medical Center in Ocala, Fla., on Aug. 1, and sold AllianceHealth Deaconess in Oklahoma City on Oct. 1.

CHS is using the proceeds from the transactions to reduce its debt load. The company's long-term debt totaled $13.67 billion as of June 30, a decrease from $13.88 billion as of the end of last year.

HCA Healthcare

Nashville, Tenn.-based HCA Healthcare has entered into a few transactions so far this year. In February, HCA expanded its market presence in Georgia when it acquired Savannah-based Memorial Health, which includes a 612-bed academic medical center and primary and specialty care network.

In late March, HCA announced it was looking to expand into North Carolina with the acquisition of Mission Health, a six-hospital, nonprofit system based in Asheville, N.C. The two parties signed a definitive agreement in August. Under the proposed transaction, HCA would use Mission Health as its platform for growth and expansion across the state.

In April, Austin, Texas-based St. David's HealthCare, which is jointly owned by HCA and two nonprofit foundations, acquired The Austin Diagnostic Clinic, a physician group with nine locations. In September, HCA expanded its Gulf Coast Division with the addition of North Cypress Medical Center in Houston.

LifePoint Health

Brentwood, Tenn.-based LifePoint Health has sold several hospitals this year and agreed to be acquired by a private equity firm.

In March, LifePoint announced plans to sell three Louisiana hospitals to Allegiance Health Management in Shreveport, La. The company completed the sale in August, and now operates only one hospital in Louisiana: Teche Regional Medical Center in Morgan City.

In July, LifePoint entered into a definitive agreement to be purchased by private equity firm Apollo Global Management. Under the proposed transaction, LifePoint will combine with Brentwood-based RCCH HealthCare Partners, which is owned by Apollo.

Tenet Healthcare

After reporting a net loss in the third quarter of 2017, Dallas-based Tenet Healthcare launched a $150 million enterprisewide cost reduction initiative. In December, the company expanded the plan, which involves cutting jobs, renegotiating contracts with suppliers and vendors, and divesting hospitals in non-core markets.

In January, Tenet announced plans to sell St. Louis-based Des Peres Hospital to St. Luke's Hospital in Chesterfield, Mo. That transaction closed May 1. Tenet entered into a definitive agreement to sell its last two Philadelphia hospitals to American Academic Health System, an affiliate of El Segundo, Calif.-based Paladin Healthcare, in 2017, and the transaction was completed in January. In March, Tenet divested MacNeal Hospital in Berwyn, Ill., and sold its minority interest in four Texas hospitals

In July, the company announced plans to sell its three remaining hospitals in the Chicago area: Weiss Memorial Hospital in Chicago; Westlake Hospital in Melrose Park, Ill.; and West Suburban Medical Center in Oak Park, Ill.

More articles on healthcare industry transactions:

Spectrum Health finalizes merger with 3-hospital system
Tower Health to acquire 19 urgent care centers
Is bigger better? Mega mergers return to health systems — 3 thoughts




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