HCA Drops Bid to Buy Salinas Valley Memorial; Natividad is Last Prospective Partner Standing
June 26, 2012
The two potential private partners for Salinas Valley Memorial Hospital have dropped out of the running. That leaves the financially struggling hospital with one prospective partner: county safety net Natividad Medical Center.
The nation's largest private hospital company, HCA, backed out with less than two weeks to SVMH's deadline for affiliation proposals. Vanguard, the mid-sized private contender in the mix, dropped out back in April.
In a memo sent to hospital staff Tuesday morning, SVMH interim president and CEO Lowell Johnson wrote, "We have received word that HCA will not be submitting a letter of intent for possible affiliation with Salinas Valley Memorial Healthcare System.
"Our Board of Directors anticipates receiving a letter of intent from Natividad Medical Center by Monday, July 2. Our board will consider that proposal, as well as the option to remain in our current structure as a stand-alone organization."
Representatives of HCA and Cain Brothers, the consultant SVMH hired to manage the search for prospective buyers and partners, were not immediately available for comment Tuesday morning.
The SVMH board of directors is expected to make a decision on whether to remain freestanding or pursue Natividad's proposal at its July 26 meeting. Even if the board opts for a merger with Natividad, it would require voter approval before the plan could take effect. The merger proposal also includes proposed state legislation to create a new joint entity that would retain Natividad's public safety-net status.
Check back later for more on this breaking story, and visit www.mcweekly.com/svmh for more stories on Salinas Valley Memorial's merger proposal.