Community Health Systems, based in Franklin, Tenn., has signed a letter of intent to buy Natchez (Miss.) Regional Medical Center, according to a Natchez Democrat report.
Natchez Regional officials confirmed CHS was the potential buyer in a news release last Friday. The organizations had been operating under a confidentiality agreement and therefore previously could not disclose the name.
CHS and Natchez Regional are now working to finalize an asset purchase agreement, which is expected to be worth $18 million total, according to the report. If CHS wins the bid to acquire Natchez Regional as the stalking horse buyer, CHS would effectively control the Natchez market, which sits on the Mississippi River just east of Louisiana. CHS owns Natchez Community Hospital, which became part of the for-profit hospital chain during the acquisition of Health Management Associates. However, once the asset purchase agreement is made public, other bidders can match CHS' offer, and county residents can also petition to take the sale of the public-owned hospital to a vote.
Natchez Regional filed for Chapter 9 bankruptcy in February. Natchez Regional CFO Charles Mock said the liabilities of the 179-bed hospital exceeded its assets by $3 million. Declining reimbursements from Medicare and Medicaid have contributed heavily to the hospital's financial problems.
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