Tuesday, April 23, 2024

Mission Health’s $1.5 billion sale expected to close by year end

After months of negotiations, Nashville-based HCA Healthcare agreed to pay $1.5 billion for Asheville-based Mission Health, the dominant hospital operator in western North Carolina. While the deal awaits an evaluation by N.C. Attorney General Josh Stein concerning the transaction’s impact on competition and whether sale proceeds will benefit the region, Mission officials say they expect completion by year-end.

HCA also pledged $430 million over five years in capital expenditures and won’t sell Mission’s six rehabilitation and acute-care hospitals for at least 10 years. The two parties propose a $50 million fund to invest in innovative health care companies that would benefit the region.

The merger has drawn criticism because of concerns that for-profit HCA will benefit from future earnings that would have accrued to not-for-profit Mission and fears that quality of care will suffer. For many years, various surveys have ranked Mission as one of the nation’s top-performing hospitals based on patient outcomes, outpacing other N.C. peers.

But Mission is making the right move because HCA can maintain quality and operate more efficiently due to its vast size, says John Ball, an Asheville physician who chairs Mission Health’s board. HCA had annual revenue of $44 billion in 2017, versus Mission’s $1.6 billion.

While Ball says Mission would face unrelenting pressure to cut costs, the system’s reports to bond-rating agencies show operating profit has increased in each of the last three fiscal years.

The key beneficiary of the sale is a new nonprofit foundation, Dogwood Health Trust, whose mission is improving health care outcomes in the region. If it gives away 5% of a $1.5 billion endowment, or $75 million, Dogwood would roughly match the amount of annual “community benefits” that Mission Health reported in its last public tax filing.

Ingles holds on

Fears that the expansion of Germany-based Aldi and Lidl and Lakeland, Fla.-based Publix Super Markets across North Carolina would damage Ingles Markets have unnerved some investors in the last two years. But the Black Mountain-based supermarket chain has bounced back, with shares gaining more than 40% over the last year. Ingles surprised analysts, with profit more than doubling to $78.9 million during the three quarters ending June 30.

Revenue increased 4.7% to $3 billion in that period. Sales at stores open at least one year increased 1.9%, a positive signal given the increased competition sparked by its rivals’ expansions.

Formed in 1963, Ingles now has about 200 stores in six states. Its most recent opening was a 72,000-square-foot store in Statesville in March. That footprint is 60% bigger than the Publix that opened in the Iredell County town in March 2017, and triple the size of Aldi and Lidl stores.

Lidl, which opened its first N.C. stores in June 2017, had 17 locations in the state as of mid-September. Publix has opened 38 N.C. stores since 2014.

ARDEN — Germany-based vehicle-parts manufacturer Reich will invest $10.9 million and add 15 jobs to its 148. The annual average wage will be 40% higher than Buncombe County’s $41,856.

BOONE — El Paso, Texas-based Mount Franklin Foods acquired Hospitality Mints for an undisclosed amount. Started in 1976, Hospitality Mints makes individually wrapped candies and mints.

ASHEVILLE — CAB Financial, which operates Carolina Alliance Bank, will be acquired by Newark, Ohio-based Park National for about $142 million. The Spartanburg, S.C.-based bank with $730 million in assets has N.C. offices here and in Charlotte and Hendersonville.

ASHEVILLE — The Center for Craft, Creativity & Design received $5.7 million from the Windgate Charitable Foundation of Little Rock, Ark., to endow fellowship programs for artists and curators. The nonprofit was founded in 1996.

CULLOWHEE — Western Carolina University reported a 6.6% increase in fall undergraduate enrollment following introduction of the N.C. Promise program, which offers reduced in-state tuition of $1,000 a year.

David Mildenberg
David Mildenberg
David Mildenberg is editor of Business North Carolina. Reach him at

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