New Northern Beaches Hospital owner Brookfield could lead to staff sackings

Senior executives overseeing the Northern Beaches Hospital may lose their jobs as current operator Healthscope prepares to sell its assets to a foreign investment firm.

An aerial photo of the Northern Beaches Hospital. Picture: Craig Willoughby.

• Another new hospital planned for then northern beaches
• Northern Beaches Hospital hiring temp staff

Senior executives may be sacked as private Northern Beaches Hospital operator Healthscope prepares to sell its assets to foreign investment firm Brookfield.

A $5.7 billion offer by Brookfield was accepted last month after a unanimous board of directors voted to sell 100 per cent of the company’s assets including a 20-year NSW Government contract to run the Frenchs Forest hospital, 42 additional private hospitals Australia-wide and 24 pathology laboratories in New Zealand.

There is uncertainty surrounding the Northern Beaches Hospital. Picture: Adam Yip

Healthscope will continue to operate the hospital, despite Brookfield being the new owners.

A Healthscope spokesman told the Manly Daily that interim chief executive officer Stephen Gameren would soon be replaced by a permanent appointment, but said the company would not acknowledge speculation regarding potential job losses for the hospital’s heads of staff.

The Manly Daily understands that the takeover by the Canadian purchaser will involve new appointments for senior executive roles at the Frenchs Forrest hospital.

The hospital currently awaits a permanent chief executive after the resignation of Deborah Latta in November last year.

Deborah Latta was the former hospital chief executive at the hospital.

Healthscope, which provides doctors and patients with access to operating theatres and nursing staff, will hand over the 20-year-lease to the investment firm later this year subject to shareholder and court approvals.

A Healthscope spokesperson said the Northern Beaches Hospital would retain its stock of health professionals and hospital staff, who would continue to operate as a division of Brookfield.

In response to Manly Daily inquiries regarding the purchaser’s experience in health services, a spokeswoman for Brookfield said the company owned one other business that operated hospitals, but did not specify names or locations.

A statement from Brookfield announcing the acquisition notes its positioning as one of Australia’s largest builder’s of hospitals, and as an international operator and investor in service businesses.

Healthscop and Broofield have released statements assuring the ongoing professionalism and quality of care at the hospital. Picture: Adam Yip / Manly Daily

Healthscope and Brookfield have released statements assuring the ongoing professionalism and quality of care at the hospital.

Financial advisor Steven Smith told the Manly Daily the new acquisition was not likely to affect the hospital’s standard of care.

The Stanford Capital director, who also runs Mosman-based property and wealth management group Wealthmart, said keeping the hospital facility running efficiently was in the new owner’s interests.

“If the community decide not to use the facility and doctors decide not to operate out of the facility then the real loser becomes the investment group, because the value of the asset will fall dramatically.

“What would you tell investors? That their investment worth one billion dollars was now worth half a billion; it wouldn’t be a great look.”

He said acquiring a hospital was a distinctive investment.

“It’s definitely a specialised acquisition, it’s a unique style investment and not for everyone,” Mr Smith said.

Healthscope Chairman Paula Dwyer. Picture: David Geraghty/The Australian.

He said the Northern Beaches Hospital was an attractive investment citing its placement in the market as a newly-built asset in a population-growth corridor offering steady income flow and minimal competition.

“A corporate takeover of this size means it can generally be passive (investment) money, that is to say return expectations tend not to be as aggressive and short-term.”

Seeing a 40 per cent rise in share prices since October last year, Healthscope previously rejected a proposal from AustralianSuper in favour of a more attractive bid made by the Canadian investment firm.

“In assessing the merits of both proposals the directors at all times have been guided by our overarching responsibility to consider the long term interests of the company and its shareholders,” Healthscope Chairman Paula Dwyer said in an ASX announcement in November last year.

Listed on the New York and Toronto stock exchanges, the purchaser; Brookfield Business Partners is an entity of Brookfield Asset Management, which boasts an asset portfolio of $330 billion.

The purchaser describes itself as “a business services and industrials company focused on owning and operating high-quality businesses that benefit from barriers to entry and/or low production costs.”