22
JOINT
VENTURES
CHS to Sell 17 Hospitals to Drive Down Debt
By Ayla Ellison
F
ranklin, Tenn.-based Community
Health Systems is in talks to sell hos-
pitals and other assets to help trim its
debt load, said CEO Wayne Smith during a
third-quarter earnings call Wednesday.
"We're not pleased with our performance in
the third quarter," said Mr. Smith. e com-
pany ended the most recent quarter with a
net loss of $79 million, compared with a $52
million profit in the same period of 2015.
However, CHS' financial challenges preced-
ed the third quarter of this year, which Mr.
Smith recognized during the earnings call.
"We have not been satisfied with our perfor-
mance over the past few quarters," he said.
Mr. Smith highlighted many of the changes
CHS has been through in recent years, includ-
ing the spinoff of Quorum Health Corp. and
the acquisition of Naples, Fla.-based Health
Management Associates' 71 hospitals in 2014.
Although CHS expects these changes to ben-
efit the company in the long term, they have
presented some challenges in the short term.
Adding to CHS' troubles is its hey debt
load of about $15 billion. e company has
recently inked agreements aimed at driving
down that amount. On Sept. 29, 2016, CHS
disclosed it had signed a definitive agreement
to sell four hospitals to Clinton, Tenn.-based
Curae Health. Last month, CHS signed a
definitive agreement to sell a controlling
interest in CHS Home Health to Louisville,
Ky.-based Almost Family, a provider of home
health nursing services.
During the third-quarter earnings call, Mr.
Smith disclosed CHS is working on seven
additional divestiture transactions to further
reduce its debt. e transactions include sell-
ing 17 hospitals, as well as home care and non-
hospital real estate, which CHS anticipates will
generate $1.2 billion in working capital. CHS
expects the transactions to close between the
fourth quarter of 2016 and the second quarter
of 2017, according to Mr. Smith.
n
"We have not been satisfied with our
performance over the past few quarters."
-Wayne Smith, CHS CEO
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