(Reuters) - Tenet Healthcare Corp (THC.N), one of the largest U.S. hospital operators, has ended efforts to sell itself, following the departure of Chief Executive Officer Trevor Fetter earlier this week, two people familiar with the matter said.
The decision will allow Tenet to focus on selecting a permanent CEO who can determine the company’s long-term strategies, said the sources, who requested anonymity because the deliberations are confidential.
Tenet has called off its sale process, the sources said. However, the company is still exploring a variety of options to tackle its $15 billion debt pile and boost shareholder value, according to one of the sources.
Tenet declined to comment.
Shares of Tenet dropped 10 percent to $12.75, giving the company a market capitalization of $1.3 billion.
“We never really thought there would be a buyer for the whole company,” Mizuho analysts wrote in a note, stating that Tenet could look at divesting its ambulatory surgery or managed healthcare services businesses.
The Dallas-based company operates 77 general acute care hospitals, 20 short-stay surgical hospitals and more than 460 outpatient centers in the United States, as well as nine facilities in Britain.
Hedge fund Glenview Capital Management, which removed two of its representatives from Tenet’s board in August, had encouraged the company to consider various strategic and financial alternatives.
Tenet said on Monday that Executive Chairman Ronald Rittenmeyer would be CEO until it chooses a permanent replacement.
Other hospital companies are facing similar struggles with their debt. Community Health Systems (CYH.N), for example, has been selling assets to raise cash following its acquisition of Health Management Associates for $3.6 billion in 2013.
Reporting by Carl O'Donnell in New York; Editing by Lisa Von Ahn