A $49 million loss for fiscal year 2010 will not stop Vanguard Health Systems from purchasing the non-profit Detroit Medical Center, reports Crain's Detroit Business. Last year, Vangaurd posted a profit of $28.6 million.
The DMC acquisition would add eight hospitals (1,734 licensed beds) to the investor-owned hospital chain, which already owns 17 hospitals (4,594 licensed beds) in Chicago, Phoenix, San Antonio and Massachusetts.
The loss notwithstanding, Vanguard plans to close the $1.5 billion deal this fall, said Vanguard Chairman Keith Pitts in a statement. The sale is pending approval by the Michigan attorney general.
According to Vanguard officials, the company plans to finance the DMC acquisition via existing cash and credit, reports the Detroit News. On June 29, Vanguard issued $225 million in senior notes to help fund the DMC deal, as said in SEC filings.
Vanguard maintains its policy to develop locally branded, comprehensive healthcare delivery networks in urban markets via acquisitions, health system officials said in a statement.
Just last month, Vanguard purchased two Illinois hospitals from Resurrection Health Care. It is also awaiting approval to acquire a heart hospital and associated cardiology practice in Phoenix, reports ModernHealthcare.
For more:
- read the Crain's Detroit Business article
- read article 1 and article 2 in the Detroit News
- here's a ModernHealthcare article
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