The Detroit Medical Center board voted Tuesday to delay its $417 million purchase agreement with Vanguard Health Systems until the end of the year to allow more time to complete governmental approvals.
DMC and Nashville-based Vanguard amended the definitive purchase agreement to conform it to the final vote by the DMC Board as soon as practicable, the two companies said in a joint statement. "All of us are looking forward to completing this process to bring DMC into the Vanguard family as soon as possible," said Keith Pitts, vice chairman of Vanguard.
Neither company detailed specific reasons for the delay.
DMC Chairman Steve D'Arcy said the complexity and size of the transaction have taken more time than expected. "Everyone involved is committed to getting this done quickly. We are absolutely confident this will be completed by the end of the year," he said.
The purchase agreement, signed in March, includes approximately $417 million for the sale of assets and to retire all outstanding DMC bonds and other long-term indebtedness. It also requires Vanguard to assume all DMC liabilities. Vanguard has also pledged to invest $850 million in capital improvements over the next five years at DMC hospitals, which D'Arcy has called "the single largest private investment in the city's history."
While the deal has drawn generally favorable reviews since it was announced last spring, some observers have raised concerns about the sale of Michigan's largest charity care provider to a private, for-profit company from out-of-state.