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Two Hospital Merger Deals Collapse

John Commins, for HealthLeaders Media, April 15, 2013

When merger talks collapse between two health systems both sides usually take pains to insist that the process was pleasant and the parting was amicable.

So it came as a surprise that Sanford Health would offer barbed remarks after announcing that its months-long confidential merger talks with Minneapolis-based Fairview Health Services ended with no deal in place.

"Sanford Health has a philosophical policy of 'only going where we are invited,'" CEO Kelby K. Krabbenhoft said in prepared remarks.

"It seems as though the incredibly positive beginnings to discussions of the merger of Fairview Health and Sanford Health, has turned into a situation that finds us being unwelcome by some interested parties and key stakeholders of our proposed merger partner. It is inconceivable and unacceptable to me that we would ever propose a merger without the affirmation of these parties."

Krabbenhoft's ire appeared to be directed at Minnesota Attorney General Lori Swanson, who at a public hearing she called on April 7, grilled executives from the sprawling South Dakota-based health system on the private negotiations and questioned their motives. Swanson had already detailed her concerns about the merger talks in a March 26 letter to Chuck Mooty, Fairview's interim CEO and board chairman.

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