Dive Brief:
- Community Health Systems has notched a deal to sell four hospitals in Arkansas as the for-profit hospital system continues deleveraging its portfolio.
- Missouri-based Freeman Health System will acquire the hospitals for $112 million, the company said Thursday.
- The transaction is expected to close in the second quarter of this year. When completed, the deal will mark Freeman’s first expansion into Arkansas, the health system said.
Dive Insight:
CHS expects to close the deal on June 1, according to the health system’s closing documents. The deal can be terminated by either party if the transaction hasn’t closed on or before Aug. 1, although both parties can agree to extend the date.
The hospitals included in the deal are 128-bed Northwest Medical Center — Bentonville; 222-bed Northwest Medical Center — Springdale; 64-bed Northwest Medical Center — Willow Creek Women’s Hospital; and 73-bed Siloam Springs Regional Hospital.
The deal represent’s Freeman’s first foray into Arkansas. Based in Joplin, Missouri, the nonprofit health system has service areas in Missouri, Oklahoma and Kansas.
Freeman has historically gathered the bulk of its revenue from outpatient services. In addition to its four hospitals, the health system owns two urgent care clinics, dozens of physician clinics and the Ozark Center, a regional community behavioral health center. The health system notched $3.6 million in profit in its fiscal year ended March 31, 2025, down from $74.8 million the prior year as expenses rose and it was hit with unrealized gains and losses.
For CHS, the sale marks another opportunity to deleverage its portfolio. Saddled with a debt load higher than its for-profit peers, CHS has embarked on a spree of divestitures in an attempt to lower its leverage. CHS divested seven hospitals in 2025 alone, including facilities in Florida, North Carolina and Texas.
Last month, CHS executives said they expect the pace of divestitures to slow as it makes progress on its debt. Still, executives acknowledged the hospital operator had a few transactions in the works.
In the future, CHS said it would consider selling standalone hospitals without a nearby care network.
