CHS Completes Acquisition of HMA for $3.9 Billion

With the addition of the 71 hospitals operated by Health Management Associates (HMA), Community Health Systems (CHS) becomes the largest hospital chain in the country, public or private, by number of facilities.

The deal was valued at $3.9 billion when CHS and HMA announced their plans last summer. The FTC, which includes debt in its calculations, put the value of the deal at $7.6 billion last week when it announced that it would approve the acquisition provided that CHS promised that it would sell two specific hospitals within 6 months.

The two hospitals that must be sold are in markets where CHS’s only competition as an acute general care inpatient services provider had come from HMA. These were in the Gadsden, Ala.-area and in South Carolina’s Darlington County. The hospitals that will be sold are Riverview Regional Medical Center near Gadsden and the Carolina Pines Regional Medical Center near Hartsville, S.C.

CHS is based in Franklin, Tenn., a Nashville suburb, and before the acquisition owned, leased or operated 135 hospitals in 29 states with an aggregate of approximately 20,000 licensed beds. With this acquisition, it will briefly have 206 hospitals with 31,000 licensed beds before dropping down to 204 hospitals in fulfillment of its promise to the FTC.

When HMA shares stopped trading on the New York Stock Exchange, investors received $10.50 in cash as well as 0.06942 shares of Community stock for each share held.