Ascension has agreed to buy Williamson Health, a Tennessee-based regional health system, in a deal valued at nearly $1 billion. The Catholic nonprofit giant continues to expand its portfolio through the acquisition of the Franklin, Tenn.-based operator of 30 locations.
The health system announced Monday its plan to sell to Ascension through the company’s Tennessee business, Ascension Saint Thomas. The board voted unanimously in support of the change of ownership.
The proposed transaction still requires approval from the Williamson County Board of Commissioners and other regulators. If the agreement clears those hurdles, the companies expect it to close in 2027 or 2028.
Why Williamson decided to sell
The decision to sell came after a two-year strategic planning process. The system determined it wouldn’t be able to survive the regulatory changes, workforce shortages and increasing expenses facing hospitals without more cash, it said.
In fall 2024, it distributed requests for proposals to 28 local, regional and national healthcare organizations. The system narrowed the field to three companies interested in a transaction: Ascension Saint Thomas, for-profit operator HCA Healthcare, and Optum, the health services division of UnitedHealth.
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The Optum offer was a 10-year partnership agreement rather than an outright sale. Williamson’s board gave it careful consideration because it would have allowed the system to remain independent — the board’s preference.
But “in addition to the evaluation of the Board’s foundational goals and objectives for a potential sale, the Board felt a unanimous and overwhelming sense of confidence and connection with Ascension Saint Thomas,” Bo Butler, the chairman of the board, said in a statement.
“Sometimes the most important considerations during monumental decisions like this are the intangible instincts that emerge during the process,” Butler added, citing Ascension’s “cultural fit,” “like-minded community-focused mission,” “commitment to our employees” and “plans to quickly invest capital.”
What the deal includes and how it will proceed
The proposed transaction carries a significant economic value. That includes a $700 million purchase price along with capital investments, upgrades to Williamson’s electronic health record and service expansions, a spokesperson said.
The health system and Ascension plan to draft a nonbinding letter of intent over the next several weeks. The companies will present that document to the Williamson County Commission for review.
It will continue independent operations as the process progresses.
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The system began exploring its future in the spring of 2024 after financial projections showed it needed $150 million in capital improvements over the next five years. Williamson’s status as an independent nonprofit made it difficult to access additional funding.
That funding would be needed to prevent the system, currently financially stable, from absorbing future losses amid mounting pressures on hospitals, executives said.
These kinds of transactions are becoming more common as independent hospitals struggle with thin margins and rising costs, even when they are not in immediate financial trouble. Ascension, meanwhile, has been rebuilding its own business after years of losses, and adding a stable regional system fits into that strategy.
The company has also been overhauling its business to stave off the same challenges. The nonprofit giant owns 90 hospitals, affiliates with another 29, and operates dozens of other care sites across 16 states and Washington, D.C. It has been reorienting its hospital-heavy portfolio more toward outpatient care.
Ascension has divested dozens of hospitals and various senior care assets in recent years, including in New York, Illinois and Michigan. At the same time, the company has acquired assets it argues will help diversify its portfolio and provide more stable income, including ambulatory surgery provider AmSurg in a deal closed last month.
