TORONTO, Sept. 23, 2016 /CNW/ - Medical Facilities
Corporation ("Medical Facilities" or the "Company") (TSX: DR),
today announced that it has closed its previously announced
transaction to acquire, in stages, an indirect 83 percent interest
in Unity Medical and Surgical Hospital ("Unity"), a physician-owned
medical and surgical hospital located in Mishawaka, Indiana. The signing of a letter of
intent to acquire the hospital and the acquisition of the
underlying real estate was announced in a press release dated
July 15, 2016.
Unity Medical and Surgical Hospital is a 50,000 square foot,
29-bed Medicare-certified facility with four surgical and two
special procedure suites focused on providing orthopedic,
ophthalmology, podiatry, pain management, and spine surgery. It is
one of the top performing hospitals in the U.S. with service scores
in the top five percent, as determined by a national survey of
patient care conducted by HCAHPS on behalf of the Centers for
Medicare & Medicaid Services, released in July 2016.
"We are very pleased to have added a strong performer to our
existing hospital portfolio," said Britt T.
Reynolds, CEO of Medical Facilities. "Unity is a leading
hospital in its community, with a skilled physician team combined
with a strong commitment to patient care and satisfaction. This
transaction is aligned with our growth strategy and we will
continue to look for similar attractive assets with value creation
potential."
As stated in the release of July 15,
2016, the hospital's operations are 86 percent owned by
Physicians ASC Management ("PAM"). Under the terms of the
agreement, the Company will purchase a 72 percent interest in PAM
(representing an indirect 62 percent ownership interest in the
hospital) for $26.63 million, and all
but four percent of the remaining ownership interest in PAM can be
purchased over three years (2017, 2018 and 2019, on the annual
anniversaries of the initial closing) at a price determined by the
fair market value of the hospital, calculated at the end of the
prior calendar year. The remaining ownership (both directly in
Unity and through PAM) will be held by practicing physicians at
Unity. The transaction has been approved by the respective boards
of the Corporation and Unity and is accretive to Medical
Facilities.
"We are proud of the progress we have made in building a quality
facility focused on patient satisfaction and positive outcomes,"
added John Day, CEO of Unity. "With
Medical Facilities, we have found a partner whose vision is aligned
with ours, who respects the role of our practicing physicians and
who is able to take us to a new level of operational
excellence."
About Medical Facilities
Medical Facilities owns controlling interests in five specialty
surgical hospitals located in Arkansas, Indiana, Oklahoma and South
Dakota, as well as an ambulatory surgery center in
California. The specialty
hospitals perform scheduled surgical, imaging, diagnostic and other
procedures, including urgent and primary care, and derive their
revenue from the fees charged for the use of their facilities. The
ambulatory surgery center specializes in outpatient surgical
procedures, with patient stays of less than 24 hours. In addition,
Medical Facilities owns controlling interest in a diversified
healthcare service company located in Oklahoma City that provides third-party
business solutions to healthcare entities such as physician
practices, facilities, and insurance companies. Medical Facilities
is structured so that a majority of its free cash flow from
operations is distributed to the holders of its common shares in
the form of dividends. For more information, please visit
www.medicalfacilitiescorp.ca.
Caution concerning forward-looking statements
Statements made in this news release, other than those
concerning historical financial information, may be forward-looking
and therefore subject to various risks and uncertainties.
Some forward-looking statements may be identified by words like
"may", "will", "anticipate", "estimate", "expect", "intend", or
"continue" or the negative thereof or similar variations. Certain
material factors or assumptions are applied in making
forward-looking statements and actual results may differ materially
from those expressed or implied in such statements. Factors
that could cause results to vary include those identified in
Medical Facilities' filings with Canadian securities regulatory
authorities such as legislative or regulatory developments,
intensifying competition, technological change and general economic
conditions. All forward-looking statements presented herein
should be considered in conjunction with such filings.
Medical Facilities does not undertake to update any forward-looking
statements; such statements speak only as of the date made.
SOURCE Medical Facilities Corporation