Recent News: Caritas Christi Health Care System to be Acquired by Cerberus Capital Management, L.P.

BOSTON, MA, March 25, 2010 -- Caritas Christi Health Care (“CCHC”) today announced that it has signed an agreement to be acquired by Steward Healthcare System LLC, a newly formed affiliate of Cerberus Capital Management, L.P. (“Cerberus”). This agreement marks the successful completion by CCHC of an extensive process to identify, evaluate and select a capital investor to complete its turnaround and position the system for future growth. Under the terms of the acquisition, CCHC will continue to be managed by its current Massachusetts-based executive team, including President and CEO Ralph de la Torre, MD. The agreement also stipulates that the six Caritas Christi hospitals will retain their Catholic identities, and their existing policies on charitable and pastoral care, community benefits, and approach to labor relations from a social justice perspective. The transaction is subject to customary closing conditions, including approvals from the Massachusetts Attorney General and the Massachusetts Department of Public Health, as well as the approval of the Archbishop of Boston.

The transaction will provide the Caritas health care system with approximately $830 million of capital support, including the assumption of all pension obligations for current and former Caritas employees, the repayment of virtually all of the system’s outstanding debt, a significant capital investment to fund operations, and a commitment to approximately $400 million of capital projects, including six major construction projects that will provide immediate upgrades to each of the Caritas Christi hospitals.

“Caritas Christi has a clear vision for the future of the system and is committed to offering world-class medical care and employment opportunities in the communities we serve. We are committed to creating an integrated community-based Accountable Care Organization,” said Dr. de la Torre. “We are striving to further improve the quality of care our patients receive, attract talented new physicians, upgrade and expand the infrastructure at our facilities, maintain or grow our staffing levels and undertake additional investments to further improve the quality of care we provide. In Cerberus, we found an investor that shares our vision and commitment.”

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