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Replies to post #144 on SunLink Health Systems Inc. (SSY)
KOmani
08/23/16 7:17 AM
#145 RE: KOmani #144
On June 6, 2016, subsidiaries of SunLink Health Systems, Inc. (“SunLink” or the “Company”) signed a definitive agreement with Piedmont Mountainside Hospital Inc. (‘Piedmont”) pursuant to which Piedmont has agreed to lease and operate the existing emergency department facility of North Georgia Medical Center. Piedmont also has agreed to lease a nearby medical office building and adjacent facilities which house physician offices and related services. SunLink’s subsidiary, Southern Health Corporation of Ellijay, Inc. will continue to provide long-term care and skilled nursing care at its 100-bed Gilmer Nursing Home. North Georgia Medical Center has provided the state of Georgia with a notice that it will suspend hospital services 30 days after the date of such notice. The emergency department lease will commence after final approval and licensing by Georgia’s Department of Community Health (DCH). Such final approval and licensing is expected to be completed by September 1, 2016 and the emergency department is expected to re-open by November 1, 2016. The lease of the medical office building will be effective July 1, 2016.
In December 2015, the Company entered into a non-binding letter of intent to lease the emergency department and medical office building at one of its North Georgia hospitals to a regional healthcare system. The lease transaction is subject to a number of conditions precedent including regulatory approval and negotiation of definitive leases. If the contemplated transaction closes, the Company will discontinue in-patient acute care services at that hospital and will continue to operate its 100-bed skilled nursing facility which is located adjacent to the hospital. If the lease transaction closes, the use of net proceeds from such transaction may include, among other things, a prepayment of long-term debt, a return of capital to shareholders via a repurchase of shares or a dividend, or other corporate purposes. However, there can be no assurance any lease transaction will be completed or, if so, that there will be sufficient proceeds to return capital to shareholders or for future acquisitions and development.