As­cen­sion, Dig­nity, Tenet reach de­fin­i­tive deal on Caron­delet

Modern Healthcare - - REGIONAL NEWS - —Me­lanie Evans

As­cen­sion Health, Dig­nity Health and Tenet Healthcare Corp. have reached a de­fin­i­tive agree­ment in a joint ven­ture that would make Tenet the ma­jor­ity owner of the Caron­delet Health Net­work in Ari­zona.

St. Louis-based As­cen­sion and San Fran­cisco-based Dig­nity, both not-for­profit sys­tems, would each have a mi­nor­ity stake in the joint ven­ture, which would be op­er­ated by Tenet, a pub­licly traded chain based in Dal­las.

Caron­delet is a three-hos­pi­tal sub­sidiary of As­cen­sion, the na­tion’s largest Catholic health sys­tem. Terms of the deal were not dis­closed, but in bond doc­u­ments re­leased last Oc­to­ber, Dig­nity said it would in­vest $30 mil­lion and Tenet would own 60% of the ven­ture, with the re­main­ing in­ter­est evenly split be­tween Dig­nity and As­cen­sion.

The Tuc­son-based Caron­delet sys­tem has had a neg­a­tive op­er­at­ing cash flow and is one of As­cen­sion’s re­cent strate­gic di­vesti­tures. As­cen­sion is seek­ing to shed un­prof­itable oper­a­tions and beef up its pres­ence in more fa­vor­able mar­kets, ac­cord­ing to an­a­lysts with Moody’s In­vestors Ser­vice.

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