The Board of Trustees of the Muskogee Medical Center Authority has voted unanimously to enter into exclusive negotiations with Capella Healthcare, Inc. to finalize the terms of agreements regarding a long term lease of the hospital. Under the terms of the proposed transaction, Capella would enter into a 40-year lease or sublease of the hospital’s real property and would acquire certain related operating assets.
The proposed agreements are valued at more than $120 million.
Under the terms of the proposed agreements, MRMC would benefit from $28 million in capital improvements over the next five years. In addition, the transaction will result in Capella paying local taxes from which the hospital was previously exempt, thereby increasing tax revenues.
Capella is a hospital management company headquartered in Franklin, Tenn. Capella currently operates four community hospitals, including Southwestern Medical Center in Lawton.
Definitive agreements between Capella and MRMC will be negotiated in the coming weeks. The transaction is expected to be complete by early 2007.