Investors from three Indiana physician groups bought the majority of Medical Facilities' interest in Mishawaka, Ind.-based Unity Medical and Surgical Hospital.
What you should know:
1. Toronto-based Medical Facilities reduced its share from 87.6 percent to 31.7 percent, receiving $1.1 million in cash considerations for the equity interests it sold to physicians affiliated with South Bend (Ind.) Orthopaedics, the South Bend Clinic, and Allied Physicians of Michiana in Mishawaka.
2. By giving up its controlling interest, Medical Facilities aims to "significantly improve facility utilization and financial performance" at Unity Medical and Surgical Hospital, Medical Facilities President and CEO Robert Horrar said in a press release.
3. After the transaction closes, Unity Medical and Surgical Hospital's debt obligation to Medical Facilities will be $20 million. If the buyers acquire more equity interest in Unity Medical and Surgical Hospital, and Medical Facilities' ownership falls below 25 percent, Unity Medical and Surgical Hospital must repay the remaining debt immediately.
4. Medical Facilities expects to make $1.4 million in capital contributions after the transaction closes. It will sell Unity Medical and Surgical Hospital's land and building assets for about $25 million.
5. This transaction comes in the wake of Medical Facilities' sale of its interest in Central Arkansas Surgical Center in January. Both are efforts to strengthen the company's balance sheet and improve operational efficiencies, Mr. Horrar said.