METHUEN — A private equity firm has agreed to buy a chain of Catholic hospitals in Massachusetts, including Holy Family Hospital in Methuen, changing the hospitals from nonprofit to profit institutions and subjecting them to property taxes.
The $830 million deal between New York-based Cerberus Capital and Boston-based Caritas Christi Health Care, must be approved by the state and the Roman Catholic Archdiocese of Boston.
Holy Family Hospital's building and land is worth almost $49 million, according to city assessing records.
Methuen's commercial tax rate is $21.91 per $1,000 of valuation, so the hospital would pay $1,069,218 per year in property taxes.
"Obviously it moves them to the tax rolls," said Methuen Mayor William Manzi. "It's a substantial value, as you can imagine."
The hospital has 1,500 employees, according to its Web site. It is Methuen's largest employer, Manzi said.
"The acquisition and the conversion of CCHC to a taxable entity, upon approval, are expected to generate significant state and local tax revenues," Caritas said in a statement.
In the statement, Caritas said the agreement positions the "system for future growth," and that it will allow the system to retain its roughly 12,000 employees and for the hospitals to continue to adhere to Catholic teachings.
In addition to Holy Family in Methuen, Caritas operates hospitals in Boston, Norwood, Fall River and Brockton — all of which need capital improvements.
Caritas said Cerberus has agreed to assume all pension obligations for current and former Caritas employees, the repayment of virtually all of the system's outstanding debt, a significant capital investment to fund operations, and a commitment to approximately $400 million of capital projects, including six major construction projects that will provide immediate upgrades to each of the Caritas Christi hospitals.
State Attorney General Martha Coakley said yesterday switching to a for-profit is a complicated process and that ultimately she will make a recommendation to the state Supreme Judicial Court, which must sign off on the deal.
She said the process could take several months.
