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St. Joseph’s Hospital on the auction block

Another ownership change is coming for the venerable hospital.

St. Joseph Medical Center, Houston’s oldest hospital, will be put up for auction next month, five years after its then-Catholic owners sold majority shares to a North Carolina-based for-profit company.

Hospital Partners of America invested heavily in the hospital but declared bankruptcy 2½ years ago and is initiating the sale as part of its Chapter 7 process. The downtown hospital is financially healthy.

“St. Joseph has been caring for the people of Houston for nearly 125 years, and there are no plans for that to change,” Chief Executive Officer Patrick Mathews said in a statement. “At the end of this process, 30 to 45 days from now, St. Joseph will still be the great institution that’s served Houston all these years. The only difference will be that our physician partners will have a new majority owner.”

St. Joseph doctors hold a nearly 22 percent interest in the hospital.

Iasis Healthcare of Tennessee signed an agreement to buy the remaining 78.2 percent interest Friday, after the bankruptcy trustee conducting the sale selected its bid as the best among 11. Another bidder could still top it at the auction April 15.

The purchase price will be based upon an “enterprise value” of $165 million, an Iasis press release said. The release noted that St. Joseph’s annual net revenue is roughly $245 million.

I’m just glad the hospital, which is where both my girls were born, is in good financial shape. That wasn’t the case a few years ago, when it looked like the place might be forced to close. May it continue to be a part of Houston’s landscape for years to come.

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One Comment

  1. Charles, what in the article makes you believe that St. Joe’s isn’t having financial problems? It was broke a few years ago, it’s majority owner is now broke, and 78.2% of an asset that is supposedly generating $245 million in annual net revenue is being sold based on an “enterprise value” of $165 million? If the hospital’s net revenue was actually that high, then buyers would be lining up to bid far more than 78.2% of $165 million. There is obviously much more to this story than what is contained in the Chron article. This is the problem with an understaffed newspaper creating articles based on press releases.