Coverage: Hospital operator Tenet Healthcare puts itself up for sale
Tenet Healthcare, one of the largest hospital operators in the country, is exploring its options, including selling the entire company, which caused its stock price to rise 13 percent on Wednesday.
Angelica LaVito of CNBC.com had the news:
Tenet CEO Trevor Fetter discussed continuing to make divestitures but did not mention the possibility of a sale in an appearance at the Wells Fargo Health Care conference last week.
Last month, Tenet said it would replace the longtime CEO and members of its board amid mounting pressure from Glenview. Fetter will step down by March 15, 2018, or when his successor is appointed, if that happens first.
Glenview pulled two of its executives from the hospital company’s board last month, citing irreconcilable differences.
Shares of Tenet have gained about 15½ percent this year, but they have fallen 72 percent over the past three years.
Carl O’Donnell of Reuters reported that the board and CEO are already being replaced:
Last month, Tenet said it would replace longtime Chief Executive Trevor Fetter and members of its board, in response to pressure from its largest shareholder to shake up the hospital company’s management.
Tension has been rising between Tenet and Glenview Capital Management, an activist investor that owns 17.8 percent of its stock.
Glenview pulled two of its executives from Tenet’s board earlier in August, citing irreconcilable differences over strategy.
Arnessa Garrett of the Dallas Morning News reported that the company’s profits have suffered under the Affordable Care Act:
Tenet has blamed its losses on declining patient volumes and uncertainty surrounding the Affordable Care Act. The company has pursued a rapid growth strategy in the last five years, snapping up smaller hospital chains and even getting into the health insurance business. But it recently sold off some of its non-core holdings.
As one of the nation’s largest healthcare companies, Tenet has 130,000 employees.
Since moving to Dallas in 2004, Tenet has grown to about 8,300 local employees. They include:
◾3,300 at United Surgical Partners International in Addison and outpatient centers.
◾2,550 at Tenet hospitals and facilities.
◾1,600 at Conifer Health Solutions in Frisco.
◾850 at Tenet’s headquarters in downtown Dallas.