Bank of America Corp, the lender that’s divesting assets to raise capital, agreed to sell 80.8 million shares of HCA Holdings Inc back to the health-care company for $1.5 billion. HCA’s stock jumped 10 per cent.
The agreement calls for a price of $18.61 a share, according to a statement on Thursday from HCA, the hospital operator based in Nashville, Tennessee.
The shares equal a 15.6 per cent stake in HCA, the company said. Bank of America, the largest US lender by assets, is based in Charlotte, North Carolina.
“It’s consistent with our strategy of focusing on our core businesses, building liquidity and strengthening the balance sheet,” said Jerry Dubrowski, a Bank of America spokesman.
“Our customers do not choose to do business with us because we have an investment in a health-care provider.”
Brian T Moynihan, the bank’s chief executive officer, has sold at least $40 billion of assets and preferred shares to raise capital and make the company easier to run.
His cost-cutting project included eliminating 30,000 jobs over the next few years, the company said this week.
Merrill Lynch & Co, the securities firm acquired by Bank of America in 2009, made the original investment in HCA for about $1 billion in 2006, Dubrowski said.
Counting the sale announced on Thursday, dividends and an initial public offering, the bank had $3 billion in proceeds from that investment, he said.
Bank of America gained 13 cents, or 1.8 per cent, to $7.18 at 9:40 am in New York Stock Exchange composite trading. HCA surged $1.86 to $20.47.