A Medical Device Daily

Community Health Systems (CHS; Franklin, Tennessee) and Triad Hospitals (Plano, Texas) reported entering into a merger agreement in which CHS will acquire Triad for $54 a share in cash, or about $6.8 billion, including $1.7 billion of existing indebtedness.

The companies said that the merger will create the largest publicly traded hospital company in the U.S. The combined company would own or operate about 130 hospitals in 28 states, with a total bed count of more than 18,700.

The acquisition is subject to certain closing conditions including approval by Triad's stockholders, antitrust clearance and other regulatory approvals, and is expected to close in the third quarter of 2007.

"The transaction with CHS validates Triad's strategy, and I am proud of the value this brings to our shareholders. We look forward to working to ensure a smooth transition for our communities," said James Shelton, CEO and chairman of Triad.

Triad has terminated its previous merger agreement with a group led by affiliates of CCMP Capital Advisors and GS Capital Partners. In accordance with the terms of the original merger agreement, Triad paid a termination fee to the original purchaser under that agreement.

CHS is an operator of general acute care hospitals in non-urban communities throughout the country. Through its subsidiaries, it owns, leases or operates 77 hospitals in 22 states.

Triad, through its affiliates, owns and manages hospitals and ambulatory surgery centers in small cities and selected larger urban markets. The Company currently operates 54 hospitals (including one under construction) and 13 ambulatory surgery centers in 17 states with about 9,855 licensed beds.

In other dealmaking activity: Eastman Kodak (Rochester, New York) reported that the European Commission has cleared Onex's (Toronto) proposed $2.55billion acquisition of Eastman Kodak's health imaging business.

The transaction was examined under the EU's "simplified" merger review procedure for cases which the commission believes do not pose competition concerns.

Included in the sale, which was first disclosed in January (Medical Device Daily, Jan. 11, 2007), are manufacturing operations focused on the production of health imaging products, as well as an office building in Rochester. About 8,100 employees of the Health Group will continue with the business following the closing.

Onex is one of Canada's largest corporations, with annual revenues of about C$20 billion and consolidated assets of roughly C$20 billion. It has global operations in healthcare, service, manufacturing and technology industries. The healthcare operations include emergency care facilities and diagnostic imaging clinics.

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