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8-K - FORM 8-K - MEDCATH CORP | g24530e8vk.htm |
EX-99.2 - EX-99.2 - MEDCATH CORP | g24530exv99w2.htm |
Exhibit 99.1
MEDCATH CONTACTS: |
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O. Edwin French
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Art Parker | |
President & Chief Executive Officer
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Chief Financial Officer | |
(704) 815-7700
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(704) 815-7700 |
MEDCATH ENTERS DEFINITIVE AGREEMENT TO SELL ITS INTEREST IN
AVERA HEART HOSPITAL OF SOUTH DAKOTA
AVERA HEART HOSPITAL OF SOUTH DAKOTA
CHARLOTTE, N.C., Aug. 30, 2010 MedCath Corporation (Nasdaq: MDTH) announced today it has
entered into a definitive agreement to sell its subsidiary which is the indirect owner of a
one-third ownership interest and management rights in Avera Heart Hospital of South Dakota to Avera
McKennan. The transaction is expected to close in 45 to 90 days, subject to certain closing
conditions.
Purchase terms are $20.0 million plus a percentage of eligible cash, which is anticipated to
net approximately $16.0 million to MedCath after closing costs and taxes. After the closing,
two-thirds of the hospital will be owned by Avera McKennan, a member of Avera Health, a regional
health care family of more than 235 facilities in South Dakota, North Dakota, Minnesota, Iowa and
Nebraska.
The agreement marks MedCaths second transaction since it announced the formation of a
Strategic Options Committee in March to consider the sale either of the entire company or its
assets. Earlier this month, MedCath announced it had entered into an agreement to sell Arizona
Heart Hospital. MedCath also announced in February that it had entered into an agreement to sell
Heart Hospital of Austin.
When Avera Heart Hospital of South Dakota was formed in 2001 as a cooperative venture among
MedCath, Avera McKennan and North Central Heart Institute, it became the regions only hospital
dedicated solely to the diagnosis and treatment of heart disease. Soon it also became one of the
nations finest. In November, the 55-bed facility was one of four MedCath hospitals ranked among
the nations 100 Top Hospitals® for cardiovascular care the fourth straight time it earned that
honor from Thomson-Reuters. Avera Heart Hospital of South Dakota also became the regions first
Accredited Chest Pain Center, ranks in the top 2 percent in the nation for patient experience and
ranks in the top 5 percent in the nation for heart attack mortality rate.
When we opened Avera Heart Hospital of South Dakota, the goal MedCath shared with its
physician partners and with Avera McKennan was to fundamentally change how cardiovascular services
were provided to the area, said O. Edwin French, MedCaths president and CEO. We achieved that
goal, and the results speak for themselves. We wish our partners and colleagues at AHHSD continued
success.
About MedCath
MedCath Corporation, headquartered in Charlotte, N.C., is a health care provider focused on
high acuity services with the diagnosis and treatment of cardiovascular disease being a primary
service offering. MedCath owns an interest in and operates ten hospitals with a total of 825
licensed beds, located in Arizona, Arkansas, California, Louisiana, New Mexico, South Dakota, and
Texas. In addition, MedCath and its subsidiary MedCath Partners provide services in diagnostic and
therapeutic facilities in various states.
Parts of this announcement contain forward-looking statements that involve risks and
uncertainties, including those relating to the sale of substantially all of the assets of Arizona
Heart Hospital and the Heart Hospital of Austin, to the sale of the MedCaths subsidiary which is
the indirect owner of the interest in Avera and anticipated proceeds thereof. Although MedCaths
management believes that these forward-looking statements are based on reasonable assumptions,
these assumptions are inherently subject to various risks, including obtaining required regulatory
approvals and satisfaction of other closing conditions, that are difficult or impossible to predict
accurately and, in some cases, are beyond MedCaths control. Actual results could differ materially
from those projected in these forward-looking statements. MedCath assumes no obligation to update
these statements in a news release or otherwise should material facts or circumstances change in
ways that would affect their accuracy.
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