Sanford Health Drops Proposed Fairview Merger Proposal

Updated: 04/11/2013 7:44 AM By: Cassie Hart

Sanford Health says it's pulling out of merger discussions with Minneapolis-based Fairview Health Services because of the hostile reception the proposal has faced in Minnesota.

In a statement, Sanford Health CEO Kelby Krabbenhoft says the Sioux Falls, S.D.,-based care system has a policy of only going where it's invited, but now it finds itself unwelcome by key interested parties and stakeholders.

Fairview is one of Minnesota's largest hospital systems and runs the University of Minnesota Medical Center.

Krabbenhoft says Sanford Health will re-engage only if Fairview and the university resolve their relationship and win over Minnesota Attorney General Lori Swanson.

Fairview Chairman and interim CEO Chuck Mooty said in a statement he's disappointed but respects Sanford's decision. He also says Fairview will no longer consider the university's own proposal to acquire Fairview.

University of Minnesota President Eric Kaler responded to the Fairview announcement in a letter to U of M leadership, writing, "This news is disappointing, given my belief that the status quote is not sustainable."

The Associated Press contributed to this report.