2 SLO County hospitals sold for $550 million. Here’s what we know
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Two San Luis Obispo County Hospitals are being sold to Adventist Health, the company announced Thursday.
Adventist acquired Sierra Vista Regional Medical Center in San Luis Obispo and Twin Cities Community Hospital in Templeton from Tenet Healthcare, the company said in a news release.
“We are excited to increase our footprint to the beautiful Central Coast of California,” Adventist Health President and CEO Kerry Heinrich said in the release.
The agreement includes related physician practices and imaging centers. The company will enter an agreement with Conifer Health Solutions, a revenue cycle service, as part of the transaction, the release said.
Heinrich added Adventist plans to expand services at the local hospitals.
“Adventist Health’s innovative, patient-centered approach will enable these hospitals to be at the forefront of advancing compassionate, community-based medicine,” Tenet Healthcare Chairman and CEO Saum Sutaria said in the release.
The agreement is for approximately $550 million, with after-tax proceeds of approximately $450 million, according to a Tenet Healthcare release Thursday.
Tenet said the two purchased hospitals and their related options generated revenues of approximately $337 million in 2023, bringing home $38 million in adjusted earnings before interest, taxes, depreciation (EBITDA) — an alternate measure of profitability.
As a result, Tenet expects to see a pre-tax gain of approximately $275 million from the sale, according to the release.
Adventist Health owns several hospitals in California. It closest location to San Luis Obispo County prior to this sale was in Hanford.
The transaction is expected to be completed in spring 2024.
What is Adventist Health?
According to its about page, Adventist Health began in 1866 with a healthcare ministry with the Seventh-day Adventist Church.
“Like our church forefathers, we promote wellness and treatment of the whole person — mind, body and spirit,” the website said. “However, we are separately owned and operated.”
The nonprofit company represents 26 hospitals and more than 400 clinics around the country, according to the website. In 2022, its total revenue was $5.4 billion, with an EBITDA of $17 million.
It also “does not participate under the ‘death with dignity’ legislation” in states it operates, according to the website.
The California End of Life Option Act, which became law in 2015 under then-Gov. Jerry Brown, allows people over 18 diagnosed with a terminal illness and with six months or less to live to end their life.
The company said “a referral may be provided” if a patient requests assistance under a death with dignity law.
