Tennova parent company sold to Franklin, Tenn., firm

FRANKLIN, Tenn. (WVLT) -- A Franklin, Tenn.-based company has agreed to acquire Health Management Associates (HMA), which owns Tennova hospitals. On Tuesday, Community Health Systems (CHS) said it will pay around $7.6 billion for the hospital chain. It will also take on approximately $3.7 billion in debt.

Once completed, CHS will control over 200 hospitals - with more than 31,000 beds - in 29 states.

"Our agreement with CHS provides substantial value to our shareholders," said William J. Schoen, Chairman of the Board of Health Management Associates.

Under the terms of the agreement, CHS will pay $13.78 in cash and stock for each HMA share. Following the merger, current HMA shareholders will own about 16% of the combined companies.

"We are pleased that this combination will create an even stronger organization for the benefit of our patients, physicians, associates and the communities we serve,” Schoen added.

CHS said it doesn't expect the transaction to affect its earnings per share forecasts for the coming year. The deal is expected to be wrapped up by the first quarter of next year.

“This compelling transaction provides a strategic opportunity to form a larger company with a diverse portfolio of hospitals that is well positioned to realize the benefits of health care reform and to address the changing dynamics of our industry,” said Wayne T. Smith, Chairman, President and CEO of Community Health Systems.

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