CHS: Former Lutheran Health Network CEO's plan to find new owner began earlier than reported

Fort Wayne, Ind.-based Lutheran Health Network and its parent company Franklin, Tenn.-based Community Health Systems recently filed an amendment to a November lawsuit against former LHN CEO Brian Bauer, alleging Mr. Bauer's efforts to secure a new owner for LHN began earlier than previously reported, according to the News-Sentinel.

According to previous reports, Mr. Bauer and a group of LHN physicians met with CHS representatives and presented an offer to purchase the eight-hospital system for $2.4 billion last May. CHS rejected the offer, stating the physician group "failed to satisfy any reasonable criteria for a reasonable offer."

The move sparked a number of terminations, including Mr. Bauer's, and resignations by LHN personnel.

However, the amendment recently filed in Williamson County (Tenn.) Circuit Court alleged Mr. Bauer discussed plans to "take over" LHN as early as September 2016, roughly eight months before the physician group's reported proposal to CHS, the report states.

LHN and CHS officials contend in the amendment Mr. Bauer and at least one LHN board member at the time traveled to Eau Claire, Wis., to meet with representatives from the home improvement chain Menards to discuss potentially buying LHN, according to the News-Sentinel.

The amendment alleged after Menards reportedly declined the offer, Mr. Bauer "began working with a group of Fort Wayne physicians . . . [and] representatives of a New York private equity firm" to craft the $2.4 billion proposal.

The initial November lawsuit filed by CHS and LHN states Mr. Bauer shared confidential information with Indianapolis-based IU Health, violating CHS' stock option agreement. The lawsuit also alleged Mr. Bauer is subject to the agreement's confidentiality and nondisparagement clauses.

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