The Real Deal - Chicago’s Health Care Team Closes Major Hospital Acquisition
February 12, 2009
Health Law Team Leads Conversion of St. Francis Hospital and Health Center to For-Profit Status. The historic hospital faced closure prior to acquisition.
Chicago partners Anne Murphy and Elias Matsakis led a national team of Holland & Knight attorneys representing MSMC Investors LLC d/b/a MetroSouth Medical Center and related entities in the acquisition of St. Francis Hospital and Health Center from SSM Health Care. The historic 410-bed hospital, founded in 1905, was slated for closure after earlier efforts to find a buyer were unsuccessful. The hospital is the largest employer in Blue Island, and is known for its high quality service and excellence in cardiac care.
The asset purchase, also included a licensed hospice and home health agency. As a result of the transaction, the hospital converted from nonprofit tax-exempt status to for-profit status. This transaction presented several unique challenges. Because the hospital closure was announced before the acquisition opportunity surfaced, the time pressure to close the deal was intense. Due diligence and negotiation of the asset purchase agreement were completed in less than a month and the deal closed less than three months from inception.
Also, because the transaction involved conversion of a tax-exempt hospital to for-profit status, it required approval from the Illinois attorney general. In addition, the transaction involved transfer of hospital assets from a Catholic entity to a non-Catholic entity. So, the transaction also required Vatican approval.
In addition to addressing these unique issues, Holland & Knight also represented the client in the associated regulatory and contracting matters. These included securing licensure, certificate of need, accreditation, Medicare/Medicaid certification, and negotiating contracts and approvals with vendors and others.
The scope and challenges of the project required the assembly of a cross-office team of health care and transactional attorneys. Maria Currier, Dana Gryniuk and Jose Fernandez (all Miami) were a central part of the team. In addition to Anne Murphy, Elias Matsakis and Maria Currier, the team included: Tom Skallas (supervised the corporate M&A team), Larry Zanger (coordinated and structured the information technology agreements), Tony Frink (real estate aspects), Ken Jenero (labor and employment aspects), Tom Kinasz (tax matters), and Mark Steger (environmental matters). They were ably assisted by a team of associates and paralegals that included Lisa Sterneck, Robyn Axberg, Liz Berlinsky, Robyn Sterling and Maureen Drews (all Chicago) and Linda Harrison Autrey (Atlanta). A key to the success of the transaction was a close working relationship with Hartford, Connecticut-based law firm Tyler Cooper, which serves as outside general counsel to buyer.
For more information, contact:
Anne Murphy
312.578.6544
anne.murphy@hklaw.com
toll free: 1.888.688.8500
About Our Health Law & Life Sciences Practice
Related Practices