Gilmore parent company to be acquired

 

By Michaela Health StockGibson Morris
Daily Journal

The Franklin, Tenn.-based Community Health Systems has signed an agreement to acquire Health Management Associates, which owns Gilmore Memorial in Amory.
In a merger agreement announced today, Community Health will pay $7.6 billion and assume $3.7 billion in debt for the Naples, Fla.-based HMA.

HMA has 10 hospitals in Mississippi which are currently in a legal dispute with BlueCrossBlueShield over reimbursement rates. Overall, it has 71 hospitals and 473 clinics in 15 states.

Community Health has two hospitals in Mississippi – River Regional Health System in Vicksburg and Wesley Medical Center in Hattiesburg.

Overall, the company has 135 hospitals in 29 states.

The deal is expected to close by the end of March 2014, according to a press release issued by Community Health.

The merger agreement continues a aggressive pattern of acquisitions for Community Health, according to the (Nashville) Tennessean. In the past six years, the company has reached more than two dozen deals to expand its footprint. The largest came in 2007, when the company spent $5 billion for Triad Hospitals.

Under the terms of the agreement, Community Health will acquire all of the issued and outstanding common stock of HMA for a combination of cash and Community Health stock currently valued at $13.78 per HMA share, based on Community Health’s closing stock price as of July 29. In addition to the cash and stock consideration, HMA shareholders would also receive one Contingent Value Right for each share they own, which could yield additional cash consideration of up to $1.00 per share, depending on the outcome of certain matters described in public filings under the “Legal Proceedings” section.