Tenet Healthcare (NYSE:THC) Corp announced on Friday that it has agreed to sell three of its hospitals and related operations in South Carolina to Novant Health for about $2.4 billion in cash.
Tenet said the after-tax proceeds from the transaction of approximately $1.75 billion will be used primarily to pay down debt.
The company estimates it will record a pre-tax gain of about $1.6 billion as a result of the sale.
Tenet had over $15 billion in long-term debt as of September 30, 2023, and recorded adjusted core earnings of $854 million in its third quarter.
As well, the company noted that its Conifer Health Solutions subsidiary will enter into a new and expanded 15-year contract to provide revenue cycle management services for the three hospitals and related operations as part of the agreement.
The transaction is expected to close in the first quarter of 2024.
Shares of Tenet Healthcare (NYSE:THC) climbed nearly 6% in pre-market trading on Friday and have gained 19% year to date.
Contact Sean at sean@proactiveinvestors.com