Dallas-based Tenet Healthcare plans to divest eight hospitals in four U.S. markets, including Philadelphia, as well as nine facilities in the United Kingdom, according to a presentation from outgoing CEO Trevor Fetter at the Baird 2017 Global Healthcare Conference.
Mr. Fetter said in the presentation he projects the additional divestitures to yield between $900 million and $1 billion of proceeds, "including cash and the elimination of capital lease debt." Tenet, which declined to comment beyond the presentation, expects to announce definitive agreements by the end of 2017.
The for-profit hospital operator is divesting facilities as it aims to reduce debt by $680 million in the near term. Earlier this month, Tenet announced plans to sell two Philadelphia hospitals — Hahnemann University Hospital and St. Christopher's Hospital for Children — to El Segundo, Calif.-based Paladin Healthcare for $170 million. Those hospitals are included in the eight additional U.S. hospitals being sold. Tenet did not disclose the names of the remaining six facilities or the markets involved.
In addition to the divestitures, Tenet also announced Aug. 31 it is replacing Mr. Fetter and "refreshing" its board. That news came after the resignation of Tenet board members Randy Simpson and Matt Ripperger, who are employed by Glenview Capital Management, a hedge fund with stakes in Tenet Mr. Simpson and Mr. Ripperger cited "irreconcilable differences regarding significant matters impacting Tenet and its stakeholders."
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