Two major health systems on the East Coast signed a letter of intent to pursue a binding partnership.

Princeton HealthCare System in Plainsboro, New Jersey, and the University of Pennsylvania Health System in Philadelphia announced yesterday their plans to merge.

Princeton HealthCare, whose annual profit is about $450 million and employs 3,000 people, has been searching for a suitable health system to merge with for the last year, considering more than 15 potential partners before choosing UPenn Health System.

“Our Board of Trustees showed remarkable foresight by contemplating a shared future even as we remained clinically and financially strong as an independent system,” said UPenn Health Systems’ President and CEO Barry Rabner in a statement.

Rabner will remain in his current positions but will report to Ralph Muller, UPenn’s CEO.

“We will focus on crafting an agreement that promotes the best interests of our patients and the community we have served for almost a century as well as our employees and physicians,” Rabner said.

Over the next several months, the two systems will negotiate and finalize the details of their agreement, which then must be approved by state and national regulatory organizations.