The Franklin, Tennessee–based for-profit hospital chain has sold another asset as part of its ongoing efforts to reduce about $1.5 billion in debts. The sale of Byrd Regional Hospital leaves CHS with one hospital in Louisiana.
Community Health Systems Inc. has sold a hospital in Louisiana to privately held Allegiance Health Management as part of its ongoing efforts to pay down about $1.5 billion in debts, the company said.
Byrd Regional Hospital is a 60-bed hospital in Leesville, Louisiana. The deal includes physician and outpatient services, and is expected to close by June, pending regulatory approval. Financial terms were not disclosed.
Franklin, Tennessee–based CHS said Byrd Regional was one of the planned sales discussed on the company’s third quarter 2017 earnings call. The sale leaves CHS with one hospital in Louisiana, the 159-bed Northern Louisiana Medical Center in Ruston.
Related: Debt-burdened CHS Sells TN Hospital to Cash-strapped Rennova
CHS has struggled financially since the $7.6 billion acquisition of Health Management Associates in 2014. At the time, the deal made CHS the largest for-profit hospital chain in the nation. Since then, CHS has sold more than 30 hospitals and plans are underway to sell more.
Last month, CHS CEO Wayne Smith told analysts he regretted the HMA acquisition.
"Based on the facts and circumstances at the time, I certainly would do the deal. Based on a retro view of it, I wouldn't do the deal," Smith said.
Although some investors have called for Smith to resign, Shanda Group, a Chinese private equity firm with a 24% stake in CHS, expressed support for Smith.
"We have consistently maintained a good relationship with (CHS) and are supportive of the company and its management team as they continue to execute on the company's strategic objectives," Shanda President Robert Chiu said in a media release.
CHS shares have rebounded slightly in 2018, and were trading at around $5.50 this week on the New York Stock Exchange, from a low of about $3.85 a share in early January.
With the acquisition of Byrd Regional, Shreveport, Louisiana–based Allegiance Health will operate six hospitals in Louisiana. The company operates 12 acute-care, long-term care, or behavioral health facilities in Louisiana, Texas, Arkansas, and Mississippi.
John Commins is the news editor for HealthLeaders.