CHARLOTTE, N.C., Nov. 1, 2010 /PRNewswire/ -- MedCath Corporation (Nasdaq: MDTH) and its physician partners announced today the completion of the sale of substantially all the assets of Heart Hospital of Austin to St. David's Healthcare Partnership, L.P. The transaction, which was announced in February and was subject to customary closing conditions and regulatory requirements, was completed today.
This marks MedCath's third completed hospital sale since it announced the formation of a Strategic Options Committee in March to consider the sale either of the entire company or its assets. Last month, MedCath announced the completion of separate sales transactions involving the Arizona Heart Hospital and Avera Heart Hospital of South Dakota.
The 58-bed Heart Hospital of Austin has a longstanding reputation for excellent clinical quality. Last November, it was one of four MedCath hospitals ranked among the nation's 100 Top Hospitals® for cardiovascular care - the fifth time it earned that honor in the 11 years the study has been performed. Heart Hospital of Austin was also one of three MedCath hospitals last year that received Excellence Awards from HealthGrades, the leading independent health care ratings organization. It was one of three MedCath hospitals cited among the leading hospitals in America by Consumers' Checkbook survey, according to the May/June 2009 issue of AARP The Magazine. And a USA Today analysis last year found that Heart Hospital of Austin had the nation's lowest death rate from heart attacks.
"We're proud of the recognition Heart Hospital of Austin has received and how it has helped distinguish MedCath," said O. Edwin French, MedCath's president and CEO. "Since Heart Hospital of Austin opened in 1998, it has always provided high quality care in an efficient manner, and we know that will continue with the new owners. We wish the best for them and for the community."
Under terms of the transaction, MedCath and its physician partners sold substantially all the assets of Heart Hospital of Austin for a purchase price equal to $83.8 million plus retention of working capital. MedCath anticipates that its net proceeds will equal approximately $24.1 million after repayment of the hospital's third party long term debt and related prepayment fee, liquidation of retained working capital, distributions to our minority partners and payment of estimated taxes.
MedCath Corporation, headquartered in Charlotte, N.C., is a health care provider focused on high acuity services with the diagnosis and treatment of cardiovascular disease being a primary service offering. MedCath owns an interest in and operates seven hospitals with a total of 653 licensed beds, located in Arizona, Arkansas, California, Louisiana, New Mexico, and Texas. In addition, MedCath and its subsidiary MedCath Partners provide services in diagnostic and therapeutic facilities in various states.
This announcement contains forward-looking statements that involve risks and uncertainties, including those relating to the estimated net proceeds MedCath expects to receive from the sale of Heart Hospital of Austin. Although management believes that these forward-looking statements are based on reasonable assumptions, these assumptions are inherently subject to significant economic, regulatory and other uncertainties and contingencies that are difficult or impossible to predict accurately and are beyond our control. Actual results could differ materially from those projected in these forward-looking statements. We do not assume any obligation to update these statements in a news release or otherwise should material facts or circumstances change in ways that would affect their accuracy.