Bass, Berry & Sims is representing Community Health Systems, Inc. (NYSE: CYH) in its plan to spinoff 38 hospitals and Quorum Health Resources, which provides hospital management and consulting services. The new company, Quorum Health Corporation (Quorum) will be headquartered in Middle Tennessee and operate independently. The businesses that comprise Quorum generated annual net revenue of approximately $2.1 billion and adjusted EBITDA of approximately $255 million in 2014. This transaction is expected to qualify as a tax-free distribution to Community Health Systems and its stockholders. The spinoff is expected to close in the first quarter of 2016.
Quorum includes 38 hospitals in 16 states, and is primarily located in cities or counties having populations of 50,000 or less. In 84 percent of the Quorum markets, the hospitals are the only acute care facilities.
Community Healthy Systems, Inc. will remain one of the largest publicly traded U.S. hospital companies with 160 affiliated hospitals in 22 states.