Tenet and USPI Complete Transaction to Acquire SCD


Tenet and USPI Complete Transaction to Acquire SCD

Tenet Healthcare Corporation of Dallas, Texas, and its subsidiary United Surgical Partners International (USPI) recently completed their previously announced transaction to acquire SurgCenter Development (SCD), according to a release. In connection with the closing of the transaction, Tenet/USPI acquired SCD’s ownership interests in 86 ASCs and other related ambulatory support services for approximately $1.1 billion.

Additionally, USPI is offering to acquire a portion of equity interests in the ASCs from physician owners for incremental consideration of approximately $250 million. This is an ongoing process that is expected to continue over the coming months, according to the release. Assuming successful completion of the acquisition of physician interests, Tenet will consolidate in its financial statements the results of the centers in which USPI holds a majority ownership position.

The company still anticipates a phased consolidation of various centers with an estimated fully ramped adjusted EBITDA of approximately $275 million by years three to four, consistent with Tenet’s previous disclosures on the transaction.

USPI and SCD’s principals have entered into a partnership and development agreement under which USPI will have the exclusive option to partner with SCD on the future development of a minimum target of at least 50 de novo centers over a period of five years, according to the release.

Goldman Sachs acted as financial advisor to Tenet, and Willkie Farr & Gallagher LLP served as legal counsel.