Baptist Health is buying Fort Smith-based Sparks Health System in a deal that's expected to close at the end of the year, the companies said Wednesday afternoon.
The definitive agreement includes the sale of Sparks Regional Medical Center in Fort Smith, Sparks Medical Center in Van Buren, and their associated clinics and operations that serve western Arkansas and parts of Oklahoma. The operations are subsidiaries of publicly traded Community Health Systems based in Tennessee. The company said in the first quarter it planned to sell some of its hospitals moving forward.
"I am humbled to think of the opportunities we have for the state's first hospital in Fort Smith to join Baptist Health, the state's largest and most comprehensive health-care system," said Troy* Wells, president and chief executive officer of Little Rock-based Baptist Health, in a statement.
The sale price was not released. Baptist Health declined to elaborate on the deal or its plans for the new operations beyond its Wednesday news release.
Baptist Health is a not-for-profit, faith-based operation. Not including the addition of the Sparks system, Baptist Health operates nine hospitals in Arkansas and employs about 9,300 people.
Arkansas has 106 hospitals of all types, and of those, 44 community hospitals have fewer than 100 beds, according to data from the Arkansas Hospital Association. There are more than 46,800 employed by the state's hospitals, according to the association, with an annual payroll of $2.9 billion.
The transaction must still gain regulatory approval, survive due-diligence checks and meet closing conditions. The sale is expected to finalize sometime in the fourth quarter of 2018.
Sparks Regional Medical Center is a 492-bed hospital and Sparks Medical center houses a 103-bed hospital. Ancillary operations include clinics and outpatient services, according to Community Health Systems. The operation employs about 2,000 people.
"Baptist Health has a proven track record of supporting Arkansas communities and expanding access to the highest quality care available and this venture is a huge win for this region," said Brandon Bullard, interim CEO of Sparks Health System.
Community Health System has been selling some of its hospital and nonhospital operations as part of a portfolio shift, according to the company's annual report. During its first-quarter earnings report in May, the company said it was working deals to sell hospitals. A Wednesday release by Community Health indicated the Sparks deal was one of the hospitals indicated in the report.
Late last month, Community Health Systems sold the 291-bed AllianceHealth Deaconess hospital in Oklahoma City.
Shares of Community Health System closed at $2.76, up 1 cent in trading Wednesday on the New York Stock Exchange. Shares have traded as low as $2.66 and as high as $9.89 over the past year.
The sale leaves Community Health Systems with six hospitals in the state, with locations in Fayetteville, Bentonville, Springdale, Siloam Springs, Johnson and El Dorado.
Business on 07/19/2018
*CORRECTION: Troy Wells is the president and chief executive officer of Little Rock-based Baptist Health. His first name was incorrect in a previous version of this story.