Tenet Healthcare to sell stake in 5 Birmingham hospitals for $910 million

Tenet Healthcare Corp. today announced a definitive agreement to sell its 70% majority ownership interest in Brookwood Baptist Health – which involves five Birmingham-area hospitals, as well as their affiliated physician practices and operations.

Orlando Health is buying the ownership interest for approximately $910 million in cash.

The transaction will include Brookwood Baptist Medical Center, Princeton Baptist Medical Center, Walker Baptist Medical Center, Shelby Baptist Medical Center and Citizens Baptist Medical Center.

Orlando Health, a private, not-for-profit healthcare organization, will manage the day-to-day operations of Brookwood Baptist Health, in partnership with Baptist Health System, according to the company. Baptist Health System will remain in the partnership, and will continue as a faith-based organization.

The system will be named Baptist Health following closing.

Thibaut van Marcke, who currently serves as senior vice president of Orlando Health Southeast Region, and president of Orlando Health’s Dr. P. Phillips Hospital, will lead Orlando Health in Alabama.

The transaction is expected to be completed this fall, subject to regulatory approvals, clearances, and closing conditions.

As part of the deal, Tenet’s Conifer Health Solutions subsidiary will enter into a new and expanded 10-year contract to provide revenue cycle management services for the hospitals.

Tenet Healthcare CEO Saum Sutaria said Orlando Health is an “esteemed, high-performing healthcare organization.”

“We are grateful for the partnership with Baptist Health System, which has enabled us to collectively enhance the high-quality, compassionate care that Brookwood Baptist Health offers,” Sutaria said. “Integration of these hospitals into their network will advance healthcare for the greater Birmingham communities.”

Orlando Health CEO David Strong said the company believes there is a “need and opportunity for a private, not-for-profit healthcare system in this market.”

“We are honored to further Brookwood Baptist Health’s mission of extending the healing ministry of Christ,” Strong said. “We believe this is a new day in healthcare for our organizations and look forward to making Brookwood Baptist the best healthcare system in Alabama.”

Brookwood Baptist Health consists of five hospitals across central Alabama with more than 1,700 beds, more than 70 primary and specialty care clinics, about 1,500 affiliated physicians and more than 7,300 employees.