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Dignity Health, Ore. hospital end acquisition talks


By Ashok Selvam
Posted: October 30, 2012 - 5:45 pm ET
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Dignity Health has broken off negotiations to acquire Ashland (Ore.) Community Hospital, the first hospital with which Dignity announced it was in talks after rebranding itself in early 2012 and setting its sights on expanding nationwide.

Neither side said why talks deteriorated, citing a confidentiality agreement. A six-month exclusive negotiating window between the hospital and Dignity, a San Francisco-based health system, began in April. However, according to a Dignity news release, "the two organizations were not able to reach an agreement on the final closing conditions for the merger and have decided to end negotiations."

Ashland has searched for a purchase partner for about a year and will now revisit other available options. Officials have said they are concerned about the hospital's financial outlook. The hospital lost money in four of the past five years through 2011, with a margin of -4.57 for 2011, according to the 2012 Oregon Community Hospital report (PDF).

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"The ACH Board is reviewing all of its options and will continue to work diligently to find a solution that has the best interests of our hospital, patients, employees and community at heart," Ashland Board Chair Douglas Gentry said in an Ashland news release.

Dignity said they will continue to search for chances to expand and "move forward with its plans to grow into a national health system."

Dignity Health, previously known as Catholic Healthcare West, changed its name in January. In August, the system paid $455 million to acquire U.S. HealthWorks, a network of 172 occupational health and urgent-care centers. The deal was first announced in July, and the price was disclosed later in a filing to bond investors.


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