Healthscope to be split up following financial collapse, receivers announce

Australia's second-largest private hospital operator is set to be divided among a consortium of four hospital operators, following its financial collapse last year.

Under the deal, 25 hospitals and the company's centralised service platform will be split between Calvary Health Care, Healthe Care, ACURIO Health, and KnG Group. Calvary Health Care will take over 14 hospitals, while the remaining 11 will be divided among the other three operators.

Healthe Care, an operator backed by private equity firm Pacific Equity Partners, will acquire several major hospitals, including Sydney's Prince of Wales Hospital and Knox Private Hospital in Melbourne.

The company went into receivership in May last year after its North American private equity owner Brookfield withdrew its support. Since then, several Healthscope hospitals have been sold, and the New South Wales government resumed control of Sydney's Northern Beaches Hospital, which Healthscope had been operating under a public-private partnership.

The receivers, McGrath Nichols, said lenders agreed to the deal after the new owners promised continuity and strong job protections for Healthscope's 14,000 frontline staff.

Keith Crawford from McGrath Nichols said the deal would also provide certainty to half a million patients who use Healthscope's services.

"Today's announcement delivers on our commitments on continuity of hospital services and protecting jobs in the interests of patients, employees and the Australian community. The continued operation of Healthscope hospitals across Australia also avoids placing additional pressure on Australia's public hospital system," Mr Crawford said.

Calvary Health Care chief executive Damien Bruce, speaking on behalf of the consortium, praised the dedication and resilience of Healthscope staff during a difficult time.

"This is an example of what can be achieved when organisations work beyond individual interests and focus on the long-term needs of patients, communities and the health system as a whole," Mr Bruce said.

"Together, we have an opportunity not only to grow, but to build a stronger, more sustainable future for healthcare that continues to put people at the centre."