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Community Health Systems sells off 4 rural hospitals to Curae Health

CHS said it had found five buyers for 12 hospitals it had planned to sell, with proceeds from all 12 expected to raise $850 million.

Jeff Lagasse, Associate Editor

Merit Health Gilmore Memorial Hospital (Google image)Merit Health Gilmore Memorial Hospital (Google image)

Community Health Systems will sell four of its hospitals, and their accompanying assets, to nonprofit Curae Health.

Earlier this month, CHS said it had found five buyers for 12 hospitals it had planned to sell, with proceeds from all 12 expected to raise upwards of $850 million for the struggling company.

The hospitals being sold are the 95-bed Merit Health Gilmore Memorial in Amory, Mississippi; 112-bed Merit Health Batesville in Batesville, Mississippi; 181-bed Merit Health Northwest Mississippi in Clarksdale, Mississippi; and the 126-bed Highlands Regional Medical Center in Sebring, Florida.

[Also: Report: Apollo Global Management in talks to buy Community Health Systems]

The transaction is expected to close during the fourth quarter of this year. Financial terms were not disclosed.

CHS is currently $15 billion in debt. Earlier this year, it raised $1.2 billion by spinning off 38 hospitals into Quorum Health Corp., and $445 million by shedding its stake in a four-hospital joint venture in Las Vegas.

[Also: Community Health Systems explores financial options as rumors of sale swirl]

The system lost $1.43 billion in the second quarter of this year, and revenue declined by 6 percent, to $4.6 billion. Recent reports have suggested that CHS is looking for a buyer.

"These four hospitals … will benefit from alignment with a smaller organization specializing in the operation of rural hospitals," said CHS chairman and CEO Wayne Smith in a statement. "Divestiture of these assets advances our strategy to focus on a portfolio of larger hospitals and regional healthcare systems."

Twitter: @JELagasse

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