Mercy Hospital, which was established in 1936 as a not-for-profit, employs more than 280 staff who cover a range of care over its 10 operating theatres.
The hospital has 67 overnight beds and day-care facilities.
In a public letter, released yesterday, hospital chairwoman Lauren Semple and Whanau Mercy Ministries Trust chairman Gerald Scanlan said ‘‘staying at the forefront of healthcare requires significant ongoing investment — as we have experienced here at Mercy Hospital with the extensive campus upgrades’’.
‘‘The board and its shareholder, Whānau Mercy Ministries Trust, have been working together to ensure the hospital is well positioned into the future to maintain its contribution and reputation.
‘‘Looking forward, we believe Mercy Hospital would benefit from a new owner, and we have been working with several entities over the past few months to explore their interest.
‘‘We can now let you know that we are in advanced discussions about a potential sale and will update you on the outcome of those discussions as soon as possible.’’
Health systems specialist and former University of Otago academic Prof Robin Gauld said the news was ‘‘fascinating’’ and in the absence of further response from the chairs, one could ‘‘only speculate’’ as to why they were going down this path.
‘‘It’s possible they see that there is significant scope for increasing their market share, but it’s going to require a lot of investment.
‘‘It could be tens and tens of millions of dollars of investment in technology and equipment that they need, and they just don’t have the capital or the ability to loan.
"They may have restrictions around loaning as well, depending upon their business model.’’
Assuming the hospital was in good shape financially, there could be several interested parties, Prof Gauld said.
‘‘This is a very interesting question as to whether it would go to a for-profit, or whether it would go to a non-profit owner.’’
In the letter, Ms Semple and Mr Scanlan acknowledged it had been a disruptive time for staff.
‘‘We know this news may be a surprise, but we want to do what is best for Mercy Hospital Dunedin as it continues to serve the people of Otago and Southland.
‘‘We are immensely grateful for the work of the Mercy Sisters, our staff, specialists, along with our outreach partners, all of whom make Mercy such a special place.’’
A private hospital is planned to be built in Dunedin, plans being revealed in September last year. The three-storey hospital in Anzac Ave, specialising in general and elective surgery, is expected to be open by mid-2028.
The hospital, once complete, will serve more than 10,000 patients a year.
The 0.39ha site is located a short distance from the University of Otago, Otago Polytechnic and Forsyth Barr Stadium, and had a 2022 capital valuation of $4.7million.
