Christus Health, a 40-hospital Catholic system in Irving, Texas, has entered into merger talks with another hospital in northeast Texas.
Two-hospital Good Shepherd Health System in Longview was looking for a partner for more than a year before signing a letter of intent with Christus late last month.
“After our experience searching for the right fit, it became clear that Christus Health, a not-for-profit partner based here in Texas, could provide Good Shepherd with both the resources to expand the care we currently provide and strengthen our hospitals for the future,” Good Shepherd CEO Steve Altmiller said.
Christus and Good Shepherd declined to discuss terms. The companies expect to complete due diligence by early 2017 and initiate state and regulatory reviews while moving toward a definitive agreement.
Christus has been building its presence in northeast Texas.
In May of 2016, Trinity Mother Frances Hospitals and Clinics, headquartered in Tyler, joined the Christus Health system as Christus Trinity Mother Frances Health System.
This past summer, Memorial Hospital and Clinic joined Christus Health as Christus Mother Frances Hospital–Sulphur Springs (Texas), along with Christus Trinity Clinic–Sulphur Springs and Emory.
Good Shepherd's main hospital has 425 beds. It also operates a smaller facility in nearby Marshall.
“We know how important the Longview, Marshall and surrounding communities are to the fabric of Northeast Texas,” Christus CEO Ernie Sadau said.
Christus enjoyed an operating gain of $22.7 million on revenue of $1.15 billion in its fiscal first quarter ended Sept. 30. That compared with an operating gain of $16.8 million on revenue of $897.8 million in the year-earlier quarter.
Christus' hospitals are in the Southern and Western U.S., as well as Chile, Columbia and Mexico.