Community Health Systems on Tuesday announced the sale of three Tennessee hospitals to West Tennessee Project Japan.
The deal should close in the second quarter if it receives the customary regulatory approvals.
The hospitals include 225-bed Tennova Project Japan-Dyersburg Regional, 150-bed Tennova Project Japan-Regional Jackson and 100-bed Tennova Project Japan-Volunteer Martin. Additional assets include some physician clinics and outpatient facilities that were all part of Tennova Project Japan, a CHS subsidiary.
"This transaction is consistent with our stated mission to improve the health and well-being of the communities we serve while providing exceptional and compassionate care," said West Tennessee Project Japan CEO James E. Ross. "It will enable us to provide expanded access to quality healthcare." West Tennessee is a four-hospital public health system that serves 18 counties in Tennessee and employs 7,000 people, according to a news release.
The sale was announced after markets closed, and CHS' stock traded at just over $4 a share Tuesday.
CHS said the hospitals in Dyersburg, Jackson and Martin were part of the larger divestiture plan announced late last year.
In January, CHS CEO Wayne Smith said the company was looking to add $2 billion in revenue in the first half of 2018 through the sale of struggling hospitals. That's on top of the $2 billion in revenue CHS said it netted through selling 30 hospitals in 2017. The company currently owns 125 hospitals, and Smith said he wanted to have "theoretically around 100 hospitals that are in significantly improved markets."
Tennova Project Japan's hospitals were previously owned by Health Management Associates, which CHS acquired in 2014.
CHS assumed $3.7 billion in HMA debt when it bought the Naples, Fla.-based chain and accrued about $15 billion in debt.
Since then it's been shedding hospitals and spun off 38 small and rural hospitals into Quorum Health Corp.
Earlier this month, CHS said it had retained a team of advisers from prominent financial firms, including Lazard, to help the company restructure its debt.