Mercy signs letter of intent to acquire two-hospital southeast Missouri system

March 1, 2023

Mercy of Chesterfield, Missouri, is in negotiations to acquire SoutheastHEALTH, a two-hospital system in Cape Girardeau, in southeast Missouri.

If the acquisition is finalized, Mercy's sponsor body, Mercy Health Ministry, would become the "sponsoring entity" of SoutheastHEALTH, said Ajay Pathak, Mercy senior vice president and chief strategic ventures officer.

SoutheastHEALTH has this flagship campus in Cape Girardeau, Missouri. Mercy of Chesterfield, Missouri, is in talks to acquire SoutheastHEALTH.

SoutheastHEALTH would become a Catholic organization, adhering to the Ethical and Religious Directives for Catholic Health Care Services.

He said the organizations have yet to determine the financial specifics of the deal.

SoutheastHEALTH is a secular system with a 244-bed flagship hospital in Cape Girardeau and a 48-bed hospital in rural Dexter, Missouri. SoutheastHEALTH also has a network of 50-plus primary and specialty care clinics and other facilities.

Mercy has more than 40 acute care, managed and specialty hospitals and a network of other facilities in Missouri, Arkansas, Oklahoma and Kansas. Mercy Hospital Jefferson in Festus, Missouri, is the Mercy hospital that is closest to SoutheastHEALTH's main campus in Cape Girardeau. The distance is about 80 miles.

Mercy and SoutheastHEALTH are conducting due diligence and expect to complete a definitive agreement in the summer. A press announcement says the organizations anticipate the integration will take place in the fall.

SoutheastHEALTH's board had determined the organization should join a larger system and it issued a request for proposals. The board selected Mercy from among respondents. SoutheastHEALTH President and Chief Executive Ken Bateman said in the announcement that Mercy was selected because it was the best strategic fit. This is in part because of its strong willingness to invest to expand health care access and make the system a regional hub in southeast Missouri and in the tristate area SoutheastHEALTH serves.

Mercy will host community listening sessions and planning exercises in southeast Missouri in preparation for the transition of ownership.

Pathak said Mercy and SoutheastHealth will work together to come up with a new name for the acquired entitity that honors the system and community.


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