Tenet Healthcare Corp. has finalized its purchase of Vanguard Health Systems, Inc. — which owns the Detroit Medical Center — for approximately $4.3 billion, the Texas-based company said Tuesday.
As part of the deal, Tenet will assume $2.5 billion of Vanguard debt. The acquisition was first announced in June.
“Through this acquisition, we have significantly increased our scale and expanded the services we offer,” Trevor Fetter, Tenet’s president and chief executive officer, said in a statement. “We intend to be a leader in addressing the opportunities in our healthcare system, and we are strongly positioned to drive improvements in quality and value for the millions of people to whom we provide care."
Tennessee-based Vanguard purchased the DMC in 2011 and said it would spend $500 million in new construction at DMC facilities over five years, plus $350 million in routine capital spending over five years. At the time, the DMC was hamstrung by debt.
A $110 million Cardiovascular Institute and the $78 million DMC Sinai-Grace Hospital emergency room and intensive care unit expansion are among the initial construction projects. Fulfillment of Vanguard's commitments are overseen by the Legacy DMC, which was set up to ensure Vanguard's promises were kept. The Legacy DMC will continue to oversee those commitments under Tenet's ownership.
Tenet now operates 77 acute care hospitals, 173 outpatient centers, five health plans and six accountable care organizations, according to the corporation. Tenet employs more than 100,000 people.