Tenet Healthcare Corporation (NYSE: THC) has announced a definitive agreement with Orlando Health for the sale of its 70% majority ownership interest in Brookwood Baptist Health in Birmingham for approximately $910 million in cash. After-tax proceeds from the sale are estimated to be around $790 million. The transaction includes the sale of five hospitals – Brookwood Baptist Medical Center, Princeton Baptist Medical Center, Walker Baptist Medical Center, Shelby Baptist Medical Center, and Citizens Baptist Medical Center – along with affiliated physician practices and other related operations. The sale will also see Tenet’s Conifer Health Solutions subsidiary entering into a new and expanded ten-year contract to provide revenue cycle management services for the Birmingham hospitals and related operations.
For the twelve months ended June 30, 2024, Tenet’s equity interest in the Brookwood Baptist Health joint venture generated pre-tax income of approximately $12 million and an adjusted EBITDA less non-controlling interest of approximately $60 million. This excludes interest expense of approximately $2 million and depreciation and amortization expense of approximately $46 million. The company estimates recording a pre-tax book gain of approximately $375 million as a result of this anticipated transaction.
The transaction is expected to be completed in the fall of 2024, subject to customary regulatory approvals, clearances, and closing conditions. Tenet also reaffirmed its latest FY24 adjusted EBITDA outlook range included in its second quarter 2024 earnings release.
Tenet Healthcare Corporation is a diversified healthcare services company headquartered in Dallas. Its care delivery network includes United Surgical Partners International, the largest ambulatory platform in the country, operating ambulatory surgery centers and surgical hospitals. Additionally, the company operates a national portfolio of acute care and specialty hospitals, other outpatient facilities, a network of leading employed physicians, and a global business center in Manila, Philippines. Its Conifer Health Solutions subsidiary provides revenue cycle management and value-based care services to hospitals, health systems, physician practices, employers, and other clients. Across the Tenet enterprise, the mission is to deliver quality, compassionate care in the communities served. As a result of these announcements, the company's shares have moved -4.2% on the market, and are now trading at a price of $141.75. If you want to know more, read the company's complete 8-K report here.
