The hospitals will become part of UCI Health, the health enterprise of University of California-Irvine.
The University of California has reached an agreement to buy four hospitals from Tenet Healthcare Corp. in a $975 million deal.
The university and Tenet announced the deal Thursday. The University of California’s regents approved the plans to acquire Tenet’s Pacific Coast Network.
If regulators approve the deal, the hospitals will become part of UCI Health, the health enterprise of the University of California-Irvine.
The news came on the same day that Tenet completed a separate $2.4 billion deal to sell three South Carolina hospitals to Novant Health.
For UCI Health, the deal expands the academic health system’s presence in Orange County. With the deal, UCI Health acquires Fountain Valley Regional Hospital, Lakewood Regional Medical Center, Los Alamitos Medical, Placentia-Linda Hospital, and a host of associated clinics.
Tenet, the for-profit hospital system based in Tennessee, said the company hopes to complete the deal in the spring of 2024. The four hospitals produced a combined revenue of about $1 billion in 2023. Tenet said in a news release the deal helps advance the company’s goal of “reducing leverage.”
Saum Sutaria, M.D., chairman and CEO of Tenet, touted the high quality of the hospitals, but also pointed to the benefits of UCI Health taking over the facilities.
“UCI Health is an innovative academic health system with a deep commitment to enabling accessibility to world-class, academic medicine closer to home,” Sutaria said in a statement. “Integrating these hospitals into their system will meaningfully enhance access to the benefits of university medicine.”
Howard Gillman, chancellor of the University of California-Irvine, says the acquisition will offer expanded access to healthcare in Orange County.
"UC Irvine has deepened its healthcare commitment to the future of Orange County, our region and California," Gillman said in a statement.
“Our vision will bridge gaps in regional care and reinforce UCI's place among the nation's leading academic health systems while advancing solutions to challenges facing healthcare,” Gillman added.
The UCI Medical Center, a 459-bed hospital, operates the region’s only Level 1 trauma center, and a National Cancer Institute-designated cancer center, one of 52 nationwide.
Chad Lefteris, president and chief executive officer of UCI Health, touted the prospect of bringing top-notch care and additional clinical research opportunities.
"As Orange County's only academic health system, UCI Health is unique in its ability to offer the highest level of advanced care powered by the research and innovation of a world-class public research institution,” Lefteris said in a statement.
Tenet’s subsidiary, Conifer Health Solutions, will provide revenue cycle management services to the four hospitals through the transition, the company said.
Tenet tried to sell its stake in another California hospital late last year, but federal regulators blocked the deal. Tenet, which owns the majority of San Ramon Regional Medical Center, sought to sell that stake of the hospital to John Muir Health. Regulators said the deal would drive up the price of healthcare in the San Francisco Bay area.
Tenet currently operates 58 acute care and specialty hospitals and more than 110 outpatient facilities.