Hospital Chains Agree To Merge

The merger of the the nation’s second and third-largest for-profit hospital chains - Tenet Healthcare Corp. and Ornda Healthcorp - will create a more competitive company, analysts said Thursday.

Tenet, based in Santa Barbara, Calif., said it would buy Nashville-based Ornda for $3.1 billion in stock and debt. The deal brings together Tenet’s 76 hospitals with Ornda’s 50 into a company with estimated annual revenues of $8.5 billion.

That would still leave it less than half the size of the No. 1 chain, Columbia/HCA Healthcare Corp., also based in Nashville

“It’s a great geographical and strategic fit between the two companies,” said analyst Sheryl Skolnick with Robertson Stephens in New York.