A proposed merger between two local health care giants appears to have fallen apart.
In a statement Thursday afternoon, the CEO of Fairview Health Services, James Hereford, says Fairview is discontinuing its plan to merge with South Dakota-based Sanford Health.
Hereford cites a lack of support from "certain stakeholders." The University of Minnesota has vehemently opposed having a company from out of state like Sanford owning its Minneapolis campus-based medical center.
"Without support for this transaction from certain stakeholders, we have determined it is in the best interest of Fairview Health Services to discontinue the merger process," said Hereford.
Sanford Health released a similar statement on Thursday, also saying it was Minnesota stakeholders that didn't support their merger. The Star Tribune reports that it is Sanford that initiated ending the merger.
“The significant benefits we identified for a combined system with Fairview Health Services compelled us to exhaust all potential pathways to completing our proposed merger,” said Bill Gassen, President and CEO, Sanford Health. “However, without support for this transaction from certain Minnesota stakeholders, we have determined it is in the best interest of Sanford Health to discontinue the merger process.”
This is the second proposed merger between the two health care companies. Another deal fell apart in 2013.
This does put the future of the University of Minnesota's teaching hospital in jeopardy. Fairview has said that the current agreement with the school, which runs through 2026, is not financially sustainable.
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