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8-K - FORM 8-K - MEDCATH CORP | g24321e8vk.htm |
Exhibit 99.1
MEDCATH CONTACTS: |
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O. Edwin French
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Art Parker | |
President & Chief Executive Officer
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Chief Financial Officer | |
(704) 815-7700
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(704) 815-7700 |
MEDCATH TO SELL ARIZONA HEART HOSPITAL TO VANGUARD HEALTH SYSTEMS
CHARLOTTE, N.C., Aug. 9, 2010 MedCath Corporation (Nasdaq: MDTH), and its physician
partners jointly announced today they have entered into a definitive agreement for Vanguard Health
Systems to acquire substantially all the assets of Arizona Heart Hospital. The transaction is
expected to close during MedCaths first quarter of fiscal 2011, which ends on December 31, 2010,
subject to certain closing conditions.
Beginning with its fourth quarter of fiscal 2010, which ends Sept. 30, MedCath will account
for Arizona Heart Hospital as an asset-held-for-sale for current and prior reporting periods.
Over the past decade, Arizona Heart Hospital and its physician partners have established one
of the countrys top cardiovascular hospitals. In November, the 59-bed facility was one of four
MedCath hospitals ranked among the nations 100 Top Hospitals® for cardiovascular care the sixth
time it earned that honor in the 11 years the study has been performed by Thomson-Reuters. It was
also one of three MedCath hospitals cited for being among the leading hospitals in America by
Consumers Checkbook survey, according to the May/June 2009 issue of AARP The Magazine. And
recently HealthGrades, the leading independent health care ratings organization, ranked Arizona
Heart Hospital among the top 5 percent of hospitals in the nation and No. 1 in Arizona for overall
cardiac services and vascular surgery.
Arizona Heart Hospital exemplifies the MedCath model of patient-focused, high quality care,
said O. Edwin French, MedCaths president and CEO. Were proud of how, working with our physician
partners, Arizona Heart Hospital has earned a sterling reputation, and we know the new owners will
continue that legacy. We wish them great success.
Under the Asset Purchase Agreement, Vanguard will acquire substantially all of the assets of
Arizona Heart Hospital for $32.0 million plus certain net working capital and assume approximately
$400,000 in capital leases. Arizona Heart Hospital will retain accounts receivable and the
remaining liabilities. Based on current asset and liability amounts, which are subject to change
with the passage of time, MedCath anticipates that total net proceeds received from the
transaction, after payment of retained liabilities and collection of accounts receivable, will be
approximately $31.5 million, after estimated closing costs and estimated income tax.
About MedCath
MedCath Corporation, headquartered in Charlotte, N.C., is a health care provider focused on
high acuity services with the diagnosis and treatment of cardiovascular disease being a primary
service offering. MedCath owns an interest in and operates ten hospitals with a total of 825
licensed beds, located in Arizona, Arkansas, California, Louisiana, New Mexico, South Dakota, and
Texas. In addition, MedCath and its subsidiary MedCath Partners provide services in diagnostic and
therapeutic facilities in various states.
# # #
Parts of this announcement contain forward-looking statements that involve risks and
uncertainties, including those relating to the sale of substantially all of the assets of Arizona
Heart Hospital and anticipated proceeds thereof. Although MedCaths management believes that these
forward-looking statements are based on reasonable assumptions, these assumptions are inherently
subject to various risks, including obtaining required regulatory approvals and satisfaction of
other closing conditions, that are difficult or impossible to predict accurately and, in some
cases, are beyond MedCaths control. Actual results could differ materially from those projected in
these forward-looking statements. MedCath assumes no obligation to update these statements in a
news release or otherwise should material facts or circumstances change in ways that would affect
their accuracy.