HealthSouth Corp., Birmingham, Ala., agreed to sell its outpatient
rehabilitation division to Select Medical Corp., Mechanicsburg, Pa., for
$245 million. The deal is expected to close in 60 to 90 days pending
regulatory approvals and other closing conditions. The division includes
about 600 rehabilitation centers in 35 states and the District of
Columbia. Privately held Select Medical said the deal would make the
company the nation’s largest operator of outpatient rehabilitation
centers with about 1,100 clinics in 37 states and Washington, D.C. The
sale is the first step HealthSouth has taken to implement a plan
announced in August 2006 to focus on inpatient rehabilitation. The
company intends to sell its diagnostic-imaging division and still is
considering whether to sell or spin off its surgery division. HealthSouth
said it would use the proceeds of the sale of its outpatient
rehabilitation division to reduce its long-term debt, which was about
$3.25 billion as of Sept. 30, 2006. -- by Vince Galloro
