Kennett, Bluff hospitals sold to Florida group

Tuesday, August 26, 2003

Daily American Republic

Tenet Healthcare Corp. has sold its hospitals in Kennett and Poplar Bluff as part of a $550 million deal that also includes two hospitals in Tennessee and one in Florida.

Tenet announced the sale Monday, along with buyer Health Management Associates of Naples, Fla. The Southeast Missouri hospitals are Three Rivers Healthcare System, a 423-bed, two-campus hospital in Poplar Bluff, and Twin Rivers Regional Medical Center, a 116-bed hospital in Kennett.

The transaction is subject to regulatory approval, but the deal is expected to close on or before Jan. 1.

The other hospitals are Seven Rivers Community Hospital in Crystal River, Fla., Harton Regional Medical Center in Tullahoma, Tenn., and University Medical Center in Lebanon, Tenn.

Tenet announced in March that it wanted to divest itself of or consolidate 14 hospitals and concentrate on hospitals in larger communities.

"We are very pleased with this transaction, which is part of our previously announced plan to divest or consolidate a number of hospitals that no longer fit the company's core operating strategy," said Trevor Fetter, Tenet's president and acting CEO. "The value of this transaction reflects the excellent reputation for quality care of these hospitals."

The five hospitals represent about $400 million in net patient services revenue and 1,061 licensed beds. The Poplar Bluff and Kennett hospitals will be HMA's first operations in Missouri. HMA operates hospitals in the Southeast and Southwest United States, primarily in rural locations.

With the acquisition, HMA operates 52 hospitals in 16 states with 7,540 beds.

"HMA continues to grow through a combination of superior same hospital operations and a disciplined acquisition approach," said Joseph V. Vumbacco, president and CEO of HMA. "These five hospitals clearly met our acquisition criteria."

Ed Dust, executive director of the Greater Poplar Bluff Area Chamber of Commerce, said the news appears to be good for the community.

"We think they will be very good for Poplar Bluff and hope the hospital continues to be a strong supporter of the community," he said. "It looks like a good company. It's financially strong. I'm real excited by it."

According to the HMA Web site, when the company acquires a hospital, it immediately sets out to upgrade the quality of health care and expand services so residents no longer need to commute to major cities for specialty health care except in rare instances.

Between 1991 and 2001, according to HMA, the company acquired 24 hospitals, and during the same period its revenue rose 676 percent from $245 million to $1.9 billion, while earnings increased 1,525 percent from $12 million to $195 million.

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