Three Illawarra private hospitals will be sold to a Chinese-owned health operator, in a transaction believed to be worth more than $50 million.
Evolution Healthcare has agreed to sell Wollongong Day Surgery, Shellharbour Private Hospital and South Coast Private Hospital to Healthe Care.
In a memo to hospital staff last Friday, Evolution’s managing director Ben Thynne and executive chairman Andrew Savage said they had thought ‘’long and hard’’ about the decision to sell.
Interestingly, they cited the proposed public-private partnership (PPP) at Shellharbour public hospital as one of the reasons for moving forward with the sale.
‘’We intended to own our hospitals for the long term but more recently a number of significant changes have occurred,’’ they wrote.
‘’These include … the Shellharbour public to private partnership which, if successful, will change the landscape for healthcare services in the Illawarra.
‘’And increasing pressure from the health funds who are reducing the scope of services covered by their policies, and using their market dominance to force smaller hospital groups like us to accept unfair price increases.’’
Mr Thynne founded Healthe Care in 2006, while Mr Savage became a director of the company in 2007. Now the third largest private hospital operator in Australia, the company was sold to China’s Luye Medical Group in December 2015.
‘’We strongly believe that our hospitals and staff will benefit from being part of a larger national group like Healthe Care who are extremely well placed to take on the challenges ahead,’’ they stated in the memo. ‘’Having been closely involved with Healthe Care previously, we are also comfortable that they offer the best cultural fit for our Illawarra hospitals.’’
The memo stated that since January 2012, when it acquired Shellharbour Private, Evolution had invested more than $60 million ‘’introducing new healthcare services and facilities to the Illawarra whilst creating hundreds of new jobs’’.
Evolution, Healthe Care and the hospitals were asked for comment. NSW Health could not confirm if Evolution had submitted one of the bids to run Shellharbour public hospital under a PPP.