Steward Health Care Finalizes on the IASIS Deal

Health Care

Boston’s Steward Health Care has recently announced that it is going to acquire IASIS Healthcare based in Franklin, Tennessee. According to online sources, the transaction is likely to be worth $1.9 billion, however the exact figure is yet to be confirmed. The agreement will see Steward hold the top position in the private for-profit hospital space in the US. Currently, Steward controls 36 hospitals across 10 states as well as runs managed care operations in Utah, Arizona and Massachusetts. The transaction will be subject to customary closing condition and regulatory approvals and likely to be closed in the third quarter of 2017.

Beth Israel Deaconess Medical Center and Partners HealthCare are stewards nearest local rivals, however other health systems that have been focusing on advanced care system under which hospitals gain more revenue and are able to maintain quality levels that measure patient health are also included in the race.  With 18 hospitals under its direct control, Steward employs over 1,300 multispecialty physicians in facilities across Ohio, Massachusetts, Pennsylvania and Florida. Meanwhile, IASIS operates a behavioral health center and 17 other hospitals across Arizona, Utah, Texas, Colorado, Louisiana and Arkansas. After the completion of the deal Steward will gain control of IASIS’s 18 hospitals, which covers around 7,500 patient beds and almost 38,000 employees — including over 1,800 directly employed multispecialty physicians as well as few thousands associate physicians. Moreover, the Boston based healthcare system will undertake operations of IASIS’ all 140 outpatient facilities across Arkansas, Arizona, Louisiana, Colorado, Utah, and Texas.  Medical Properties Trust – a real estate investment trust company based in Birmingham, Alabama and Ceberus Capital Management LP a private equity firm based in New-York are the major backer of Steward Health Care.

Under the deal, Medical Properties Trust will receive the benefits of IASIS’ entire hospital real estate possessions and commitments, which includes long-term loans and leases with Steward. According to the terms of the deal, the amount that will be paid in cash by various financing sources and MPT will be used to retire IASIS’ unsecured notes and senior secured term loans. The remaining cash proceeds payable to IASIS will be transferred to its equity holders, including TPG Capital and the majority stockholders. Following the completion of acquiring eight hospitals from a Franklin, Tenn.-based Community Health Systems in the month of May, the IASIS will be the latest in a series of acquisitions made by Steward.

About Anurag Sharma 4 Articles
Delivering high-quality research and consulting projects at tight deadlines remains Anurag Sharma's forte. An experienced market research professional, he has helped business of varied scales make key strategic decisions. Anurag is a specialist in the medical devices market research domain, and has accurately predicted the trends in the market. Anurag is an avid traveller and music aficionado; in his free time, he loves to introspect and plan ahead.

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