CHRISTUS Health announced today that it has signed a Memorandum of Understanding (MOU) with Pontificia Universidad Católica de Chile (PUC) in Santiago, Chile, to guide negotiations toward a definitive joint venture agreement for the ownership, operation and expansion of PUC’s health network. In addition, the groups signed an interim management agreement, which will remain in place until the transaction is complete.
Both parties anticipate that the final agreement will include CHRISTUS’ ownership of a 40 percent share of the joint venture, which will allow the partners to work together on the joint operation of facilities in Chile and any expansion that may be appropriate to serve the people and health care needs in the area.
“We are excited to reach a milestone in our negotiations with PUC upon the signing of this Memorandum of Understanding,” said Ernie Sadau, president and CEO of CHRISTUS Health. “We believe that the partnership we create in Chile and our experience in Mexico will allow us to meet deep health care needs and will also help us diversify our operations, strengthen Catholic health care around the world and help CHRISTUS lead the development of new, international health care models.”
CHRISTUS Health and PUC will complete due diligence and negotiations toward a definitive joint venture partnership agreement, which they hope to complete in the next three to six months.
The interim management agreement calls for CHRISTUS to provide a local chief executive officer, chief operating officer and chief financial offer, as well as to appoint members to a transition committee (composed of leaders from PUC and CHRISTUS), which will oversee the interim management team and ensure each group’s operational priorities are effectively managed during the transition. The CHRISTUS team in Chile includes:
Interim Chief Executive Officer, Joseph Barcie, M.D.
- Chief Operating Officer, Alex Canavati
- Chief Financial Officer, Sergio Melgar
Joseph Barcie serves as Senior Vice President of International Services for CHRISTUS Health. He has 21 years of professional experience in acute care hospital management, significant senior level hospital administration experience in both the U.S. and Latin America, and is fluent in Spanish and Portuguese.
Dr. Barcie previously served as Corporate Assistant Vice President at Baptist Health International and Baptist Health South Florida, the largest faith-based, not-for-profit health care organization in the South Florida region. He also served as President of Centralized Operations for International Hospital Corporation, the largest pan-Latin American private hospital system with facilities in Mexico, Brazil and Central America.
Alejandro Canavati joined CHRISTUS Muguerza in February 2008 as Chief Financial Officer, where he is responsible for the financial health of the Mexican region. CHRISTUS Muguerza is a joint venture in Mexico that CHRISTUS Health has operated since 2001. Today, it is comprised of eight hospitals and many ambulatory clinics, with a total of 4,600 employees and over 75 years of history.
Sergio L. Melgar has over 30 years of health care experience. He spent the previous 19 years specializing in academic medicine as the Senior Associate Director and CFO of the UCLA Health System and as the Senior Vice President for Health Affairs at the University of Kentucky and CFO of UK HealthCare, its hospital and physician practice. While at these institutions, Sergio was responsible for the financial management and integration of the academic institutions; he also led mergers, acquisitions and integration of their community partners.
PUC began searching for a strategic partner over a year-and-a-half ago, as they recognized that the swiftly changing health care landscape and growing competitiveness in the health care sector required new forms of management and significant investments to maintain and grow performance. Many stakeholders were considered, and 12 initial proposals were evaluated. In October 2012, PUC selected CHRISTUS as the sole finalist to pursue negotiations toward a definitive joint venture agreement for the ownership, operation and expansion of PUC’s health network.
Banchile Citi Global Markets and Citigroup Global Markets are acting as exclusive financial advisors to CHRISTUS Health in the negotiations toward a definitive joint venture partnership agreement.
Pontificia Universidad Católica de Chile is a top Chilean university owned by the Catholic Church with more than 25,000 students in undergraduate and graduate programs. It is one of the leading institutions of higher education in the country and in Latin America. According to the 2012 QS Ranking, the university ranks in the first place in Chile and second in Latin America. Through its Faculty of Medicine, PUC operates the premier medical school in Chile where extensive teaching and research take place. The PUC Health Network is one of the largest health systems in Chile, and consists of two hospital campuses totaling approximately 600 beds, as well as 11 outpatient centers and a large laboratory and imaging services network, making it one of the largest health systems in Chile.