Rejecting a late-hour bid from Columbia/HCA Healthcare Corp., 202-bed Cape Coral (Fla.) Hospital agreed last week to be acquired by Lee Memorial Health System, Fort Myers, Fla.
Lee Memorial offered $145 million for Cape Coral, which owes about $130 million in bond debt and interest.
The two began negotiating in April for the scandal-plagued hospital. But last month Cape Coral agreed to review a bid from Columbia (June 3, p. 6). Physicians and employees fired off petitions in support of Lee Memorial.
At a public board meeting June 6, four Cape Coral trustees voted to accept the Lee Memorial bid after hearing a pitch from both Lee Memorial and Columbia, a Cape Coral spokeswoman said. Seven board members, worried about potential conflict of interest, abstained from the vote after consulting with their attorneys, the spokeswoman said.
The Cape Coral board heard from some 30 citizens who supported the offer from Lee Memorial. Prompted by a lawsuit, the Cape Coral board opened its meeting to the public for the first time, she said. The Lee Memorial board is expected to approve the deal, the spokeswoman said.
Not-for-profit Cape Coral also will join a regional provider organization that Lee Memorial, a two-hospital public system, formed with Sarasota (Fla.) Memorial Hospital in February. That company was formed to compete against Columbia in southwest Florida, where it operates seven hospitals (Feb. 26, p. 61).
During the past two years, three former Cape Coral executives were fired for allegedly misspending hospital assets, and deals fell apart to sell the facility to Lee Memorial and Health Management Associates of Naples, Fla.
In 1994, the Federal Trade Commission challenged the proposed merger between Cape Coral and Lee Memorial. Cape Coral pulled out of the deal at that time. The FTC is not expected to challenge the current agreement.