Ardent Health Services Acquires LHP Hospital Group, Creating 19-Property Hospital Group
LHP Hospital Group operates Bay Medical Center in Panama City, Fla., as part of a joint venture. Ardent will take over operational duties as part of the acquisition. (Image courtesy of ardenthealth.com)
NASHVILLE, TENN. — Ardent Health Services has acquired LHP Hospital Group Inc., creating the second largest private, for-profit hospital operator in the United States, with 19 hospitals in six states and $3 billion in revenues, according to Ardent.
Although the purchase price was not disclosed, Ventas Inc., a massive healthcare REIT, provided $700 million in financing to Ardent for the acquisition. The five-year, LIBOR-based acquisition loan bears an initial cash interest rate of approximately 8 percent.
As part of the transaction, Ardent received a significant equity contribution from its majority owner, an affiliate of Equity Group Investments. Ventas also made an equity contribution to maintain its 9.9 percent equity stake in Ardent.
LHP’s portfolio of hospitals were all operated in joint ventures. LHP’s portfolio includes Bay Medical Center in Panama City, Fla.; HUMC Mountainside in Montclair, N.J.; HUMC at Pascack Valley in Westwood, N.J.; Portneuf Medical Center in Pocatello, Idaho; and Seton Medical Center in Harker Heights, Texas.
Under the terms of the agreement, Ardent will assume LHP’s management and operational responsibilities within each joint venture partnership. The transaction is not expected to impact the day-to-day operations of the affiliated hospitals.
The Ardent management team will also continue to lead the company with the assistance of key LHP executives, and will remain headquartered in Nashville, Tenn.
“Today marks the beginning of an exciting new chapter for our company,” said David Vandewater, president and CEO of Ardent Health Services. “With a shared focus on local partnerships and collaboration, and the additional scale and market diversity we gain through this merger, Ardent is well positioned to compete in a rapidly changing healthcare environment.”
Citigroup acted as exclusive financial advisor to LHP in this transaction.
— Katie Sloan