Novant Health backs out of North Carolina hospital buyout after FTC pressure
Novant Health is backing away from its attempt to buy two North Carolina hospitals after the Federal Trade Commission was granted an injunction in an appellate court.
The $320 million deal would have allowed Novant to purchase Lake Norman Regional Medical Center and Davis Regional Medical Center from Community Health Systems. The FTC’s initial challenges to block the bid were unsuccessful. However, on Tuesday, the Fourth District U.S. Court of Appeals temporarily sided with the FTC in blocking the deal.
That was enough for Novant to back out, as the appeals process can take two years or more.
Lake Norman Regional is a 123-bed facility in Morrisville, Davis Regional a 146-bed facility in Statesville. While Atrium Health is the largest provider in the state, Novant is currently the second. The FTC argued the purchase of these two regional facilities would stifle competition, especially in that region of North Carolina.
Novant Health currently operates more than 700 medical clinics and hospitals nationally and sees more than 6.7 million patients. They are headquartered in Winston-Salem.
In its vote, the 4th circuit was split 2-1 on the case. According to coverage from the Charlotte Observer, the dissenting judge, Harvie Wilkinson, reasoned this purchase was not a merger between healthcare giants—and Davis Regional faced significant financial hardship before the attempted buyout.
Wilkinson argued the FTC overstepped its regulatory authority.
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