Letter of Intent offered to acquire Rhode Island-based Care New England Health System
StoneBridge Healthcare, an innovative company formed to buy, save and turn around distressed hospitals in the cities and suburbs of America, announced it has presented a Letter of Intent (LOI) to purchase Rhode Island-based Care New England Health System. StoneBridge would make a significant investment in order to financially stabilize Care New England to allow the health system to continue its mission to transform the future of health care for the communities it serves.
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“Care New England Health System has provided outstanding care to its patients for many years, and StoneBridge Healthcare is committed to the continuation of this high standard of care in Rhode Island,” said Joshua Nemzoff, Chief Executive Officer, StoneBridge Healthcare. “We believe that StoneBridge Healthcare is in a strong position to help Care New England to continue delivering cutting-edge care to the communities it serves for years to come.”
StoneBridge has offered a transaction value of $550 million with a purchase price of $250 million and a $300 million investment in capital improvements over six years to further transform the health system. The offer that StoneBridge has submitted includes a provision that will fully fund the employee’s pension plan at closing – a plan that is currently underfunded by more than $125 million. Care New England hospitals include the following: Butler Hospital, Kent Hospital, Women & Infants Hospital of Rhode Island, Care New England Medical Group, the VNA of Care New England, The Providence Center, and a certified accountable care organization (ACO) Integra.
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“As the cost of care has risen and the COVID-19 pandemic has placed a tremendous strain on health systems across the nation, StoneBridge Healthcare is ready to assist Care New England during these challenging times to continue delivering an outstanding continuum of care to the region,” Nemzoff added. “StoneBridge Healthcare has the expertise and financial resources needed to help lead Care New England to a promising future.”
The LOI is not binding, and a Definitive Agreement would be finalized in a short period of time once comprehensive due diligence is performed. StoneBridge is a privately-owned company capitalized through a multi-layered composite finance group that includes nationally known debt and equity sources.
Earlier this year, StoneBridge submitted an offer to acquire the Erlanger Heath System in Tennessee for a transaction value of $475 million. StoneBridge is actively pursuing discussions related to this transaction, which is a system of similar size to Care New England and has also been devastated by the impact of the COVID-19 pandemic.
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