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Providence St. Joseph Health affiliate in talks to buy 80-bed California hospital

The district overseeing Petaluma (Calif.) Valley Hospital has proposed selling the 80-bed facility to an affiliate of Renton, Wash.-based Providence St. Joseph Health. The proposal comes after several failed attempts to find a hospital operator to lease it. 

Under the proposal from the Petaluma Health Care District, the facility would be sold to NorCal HealthConnect, an affiliate of Providence St. Joseph Health, for $52.6 million.

The district has been looking for a long-term operator for Petaluma Valley Hospital for more than four years, according to the announcement. Ramona Faith, CEO of the health care district, said the process has been "complex" and at times,"challenging."

"We had focused on securing a long-term lease, but this option didn’t secure the best terms for our hospital or our residents," Ms. Faith said. 

A subsidiary of Providence St. Joseph Health operated Petaluma hospital on an interim basis since its 20-year lease expired in 2017, according to local newspaper Petaluma 360. The district wanted to extend the lease, but negotiations ended over financial terms and a noncompete clause. 

A spokesperson for Providence St. Joseph confirmed to the newspaper that NorCal HealthConnect is in talks with the district to buy the hospital. 

"We are excited that we have come to tentative terms on the purchase of Petaluma Valley Hospital," the spokesperson told the newspaper. "As always, our goal has been to ensure the Petaluma community continues to have access to the high quality healthcare services they have today. "

The district board and Petaluma voters must approve any sale. 


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