Community Health Systems, Inc. announced yesterday that a majority share of its Home Health division will be sold to Almost Family, Inc., headquartered in Louisville, Ky.
The 80% stake of CHS’s home health division, which has annual revenue of $200 million, will bring it back $128 million in cash. The deal will be completed by the end of the year.
For that $128 million, Almost Family gets 74 home health and 15 hospice branch locations in 22 states from CHS.
“We believe the agencies in the Company’s Home Health division will benefit from affiliation with an organization specializing in home health care. The transaction also advances our strategy to focus on a more sustainable and successful portfolio of hospitals and regional healthcare systems,” CHS CEO Wayne Smith said in a release. “The transaction also advances our strategy to focus on a more sustainable and successful portfolio of hospitals and regional healthcare systems.”
CHS, headquartered at 4000 Meridian Blvd. in Franklin, is Williamson County’s largest single employer, with more than 5,000 employees.
The company has previously announced plans to reduce and refine its overall portfolio with proceeds being used to pay down debt. The spinoff of Quorum, completed in August, brought back $1.2 billion.
“Community Health Systems’ primary focus continues to be on delivering high-quality health services in the communities where we operate,” said CEO Wayne Smith in a statement in September.
CHS, the second biggest for-profit hospital chain in the country by revenue, owns, leases or operates 153 affiliated hospitals in 22 states with an aggregate of nearly 27,000 licensed beds.
Its stock traded around $10 last week, down from about $60 at this time last year, and in the second quarter of this year it reported a $1.43 billion losses in continuing operations, or $12.90 per share.
Its fall largely comes from debt, and poor past acquisitions. It has been trying to shed some of that debt this year, and raise cash.
It is trying to sell off at least 12 hospitals, some of which it just bought in a 2014 acquisition of Health Management Associates, an indebted chain of more than 60 hospitals that CHS paid $3.9 billion for.
CFO Larry Cash said in a release earlier this month that of the 153 hospitals CHS currently operates, the former HMA facilities continued to post losses- 3 percent in the second quarter.
In another action this summer, CHS spun off Quorum Health Corp., 38 smaller, rural hospitals, into its own public company, raising $1.2 billion, according to its quarterly reports. It also sold for $445 million its interests in four Las Vegas Hospitals.