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Aug. 1, 2011 /PRNewswire/ -- MedCath Corporation (Nasdaq: MDTH) and Lovelace Health System, Inc. jointly announced today the completion of sale of substantially all the assets of MedCath's Heart Hospital of
New Mexico to Lovelace, which is an affiliate of Ardent Health Services, based in
Nashville, Tenn. The transaction was announced in May and was subject to MedCath stockholder approval, regulatory approval and other customary closing conditions listed in the Asset Purchase Agreement. Navigant Capital Advisors provided advisory services to MedCath related to the transaction.
Together with the sale of its equity interest in Arkansas Heart Hospital also announced today, MedCath has completed nine transactions since announcing in
March 2010 it had formed a Strategic Options Committee to consider the sale either of the entire company or its assets. Since October, MedCath has announced the completion of sales involving the following four hospitals: Arizona Heart Hospital, Avera Heart Hospital of
South Dakota, Heart Hospital of
Austin and TexSan Heart Hospital. In addition, MedCath's Partners division sold its minority interest it held in Southwest Arizona Heart and Vascular, LLC in November, and in May, it completed the sale of its ownership interest and management agreement in Coastal Carolina Heart, as well as the sale of the majority of its assets to DLP Healthcare, a joint venture of LifePoint Hospitals and
Duke University Health System.
When the Heart Hospital of
New Mexico opened in
October 1999, it became the state's first hospital dedicated to the prevention and treatment of heart disease. It's been ranked among the top five percent nationwide in patient experience by Health Grades, the leading independent health care ratings organization. It's also the state's only hospital to receive a five-star rating from Health Grades for Treatment of Heart Attack, it's recognized as an accredited Chest Pain Center and it's been designated by Blue Cross Blue Shield of
New Mexico as a Blue Distinction Center for Cardiac Care.
"Heart Hospital of
New Mexico resulted from the shared vision of two talented cardiovascular physicians groups that pioneered
New Mexico's leading heart programs," said
O. Edwin French, MedCath's president and CEO. "We are very proud of how that vision became reality, and we know that Lovelace Health Systems will continue that legacy. We wish them continued success."
The transaction values the Heart Hospital of
New Mexico's assets at
$119.0 million. The limited liability company that currently owns Heart Hospital of
New Mexico, of which 74.8% is owned by MedCath, will retain its net working capital. MedCath anticipates receiving approximately
$62.0 million in net proceeds from the transaction, including its share of Heart Hospital of
New Mexico's cash, and after collection of all accounts receivable, payment of all known liabilities, including taxes, and repayment of inter-company debt owed by Heart Hospital of
New Mexico to MedCath, pro-rata minority interest payments and an allocation of additional funds to the limited liability company's minority partners by MedCath in consideration for such minority partners' consent to the transaction that was required under the limited liability company's Operating Agreement as a condition to entering into this transaction. The anticipated net proceeds do not include any reserves for unknown or contingent liabilities retained by Heart Hospital of
New Mexico, including without limitation any liability which may arise from the New Mexico ICD investigation.
"The medical staff and nurses of the Heart Hospital of
New Mexico have a strong reputation for exceptional clinical quality and high patient satisfaction," said
Ron Stern, president and CEO of Lovelace Health System. "We will build on that success and increase access to the Heart Hospital to more people in
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 four hospitals with a total of 366 licensed beds, located in
SOURCE MedCath Corporation