Venture capital firm HATCo to buy Summa Health for $485 million

Akron, Ohio skyline

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Akron, Ohio-based Summa Health has entered a definitive agreement to be purchased by venture capital firm General Catalyst Health Assurance Transformation (HATCo) for $485 million.

The purchase will allow the health system to eliminate $850 million in existing debt, according to Summa Health. The health system will transform from a nonprofit health system to a for-profit, taxable system.

HATCo was founded in 2023 by General Catalyst, a private venture capital firm based in Cambridge, Massachusetts.

The definitive agreement, announced Thursday, outlines a significant investment in the health system, Summa Health said. The purchase price of $485 million, when added to Summa Health's current cash, will eliminate its $850 million debt.

The remaining cash, after closing adjustments, will fund a new, separately governed community foundation that will support focused investment to benefit community health in the Greater Akron region, the health system said. 

HATCo has committed $350 million in capital funding within the first five years for routine purposes, and investment in technologies. 
Additionally, HATCo has committed $200 million for strategic and transformative investments that will drive innovation over the first seven years.

The transaction is subject to regulatory review and approval. Summa Health and HATCo are submitting applications related to the proposed transaction to the Ohio Attorney General, the Ohio Department of Insurance, the Federal Trade Commission and other applicable authorities in compliance with regulatory review processes.

WHY THIS MATTERS

Summa Health and HATCo said they have been working to shape a comprehensive plan that includes maximizing resources and improving workflow. The organizations have begun to collaborate on a transformation plan, which includes the creation of working groups with representation across Summa Health.

Employees, providers and the leadership team of Summa Health will transition to the new entity. Maintaining and growing Summa Health's workforce is critical to pursuing this transformative work, the companies said. 

Summa Health will maintain its charity care policy, community benefit and essential services it currently offers, while it also focuses on sustainable growth and enhanced care access.

THE LARGER TREND

Summa Health has more than 1,300 licensed beds in the following clinical settings: Summa Akron Campus, Summa Barberton Campus and Summa Health Wadsworth-Rittman Medical Center.

It is among the largest integrated healthcare delivery systems in Ohio, encompassing a network of hospitals, community medical centers, a health plan, an accountable care organization, a multispecialty physician organization, research and the Summa Health Foundation.

ON THE RECORD

"As part of HATCo, Summa Health will be better positioned to build upon our existing strengths and capabilities while also benefiting from new opportunities and technology. Our goals are to expand access to care and improve the experience for our patients, providers and staff," said Dr. Cliff Deveny, Summa Health president and CEO.

"We view this long-term investment as a critical milestone – not only to build on Summa Health's existing strengths, but also to create a blueprint for the future of healthcare delivery," said Hemant Taneja, CEO of General Catalyst, and founder and executive chairman of HATCo. 
 

Email the writer: SMorse@himss.org