FORT WAYNE, Ind. (WANE) – Executives at Community Health Systems, the parent company of Lutheran Health Network, have a noon Monday deadline to accept a buyout offer, according to a report by Bloomberg.
The $2.4 billion offer was made May 15 by a group of local physicians.
The report said physicians own 20 percent of Lutheran and CHS owns the remaining 80 percent.
Bloomberg said executives at CHS were looking for a selling price nearly 12 times the network’s earnings. According to various reports, the Lutheran network brings in approximately $300 million a year in profits.
The $2.4 billion offer would fall below the asking 12, and closer to 10.8 time EBITDA, according to Bloomberg.
EBITDA – in financial terms, is earnings before interest, taxes depreciation, and amortization. It’s used to gauge a company’s financial performance but can also be used to estimate future earnings potential.
Bloomberg reported the doctor’s bid is backed by a private equity firm and another hospital chain.
Those two parties, however, were not disclosed.
Community Health Systems has not responded to multiple requests for comment regarding a potential buyout.