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Metro Health in Michigan Considers Partnership With CHS, Cleveland Clinic

The board of directors at Metro Health, based in Wyoming, Mich., has decided to "explore a strategic equity partnership" with Franklin, Tenn.-based Community Health Systems and Cleveland Clinic.

The board plans to sign a letter of intent to negotiate exclusively with CHS and Cleveland Clinic, followed by due diligence and additional negotiations for a definitive agreement. Any transaction would be subject to regulatory review.

Details of any potential transaction were sparse, and financial details were not disclosed. However, CHS and Cleveland Clinic announced a similar equity partnership with Akron (Ohio) General Health System in August. In that transaction, CHS and Cleveland Clinic agreed to purchase most assets of Akron General in a joint venture operation. The deal is currently undergoing due diligence.

Metro Health President and CEO Mike Faas said Metro Health, which includes a 208-bed hospital, has been considering an affiliation for a while. Officials ultimately decided to partner with CHS and Cleveland Clinic due to the organizations' quality of care and Cleveland Clinic's world-renowned clinical programs and medical experts.

"This process is an important part of the work we are doing to ready our organization for the changes occurring under the Affordable Care Act and to position Metro Health for long-term success and growth," Mr. Faas said in a news release. "Metro Health is a strong and progressive healthcare organization, and like many other community hospitals and health systems aligning with partners, we can see the potential advantages of scale, access to national resources and the sharing of best practices."

In March, Cleveland Clinic and CHS formed a strategic alliance that kept both entities independent but allowed them to collaborate on quality initiatives and new community hospital partnerships. CHS is also in the middle of acquiring the troubled Naples, Fla.-based Health Management Associates in a deal valued at $7.6 billion. The merger would make CHS the largest for-profit hospital company in the country in terms of hospitals owned.

More Articles on Hospital Transactions:
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SCL Health System to Form Joint Venture With National Jewish Health
Providence Reaches Agreement to Take Over Saint John's Health Center

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