Currently in Canada, between $3 and $4 billion of assets are financed annually through various forms of leasing, with the sale and leaseback transaction as the common vehicle for larger value asset financing.
Financial theory of sale and leaseback is applied to Canadian hospitals with illustrations of the structure and process of sale and leaseback in practice. The moratorium on sale and leaseback transactions recently imposed by the federal and Ontario governments is also covered.
Get full access to this article
View all access options for this article.
References
1.
ForsbergR.1969. Leasing: Economic and medicare aspects. Hospital Financial Management23(6): 12–14.
2.
HenryJ. and RoenfeldtR.1978. Cost analysis of leasing hospital equipment. Inquiry15(1): 33–37.
3.
RoenfeldtR. and HenryJ.1979. Lease cost measurement of hospital equipment under cost-based reimbursement. Financial Management9(1): 24–35.
4.
RushkoffM.1971. How reimbursement affects the lease versus purchase decision. Hospital Financial Management25(8): 11–12.
5.
ShaulR. and McLaughlinC.1977. A second look at leasing. Health Care Management Review2(2): 55–63.
6.
AnsleyC.E. and CleverleyW.O.1983Lease financing and risk in the hospital industry. Topics in Healthcare Financing (3):68–77.
7.
AndersonR. and McCoyJ.1985. Caution: Leases can hide dangerous curves and clauses. Healthcare Financial Management39(10): 24–34.
8.
BaylessM.E. and DiltzJ.D.1985. Leasing strategies reduce the cost of financing healthcare equipment. Healthcare Financial Management39(10): 38–48.
9.
BrealeyR. and YoungC.1980. Debt, taxes, and leasing: A note. Journal of Finance35(5): 1245–1250.
10.
FranksJ.R. and HodgesS.D.1978. Valuation of financial lease contracts: A note. Journal of Finance33(10): 647–669.
11.
HullJ.C.1982. The bargaining positions of the parties to a lease agreement. Financial Management12(3): 71–79.
12.
LevyH. and SarnatM.1979. Leasing, borrowing, and financial risk. Financial Management9(4): 47–54.
13.
MyersS.C.DillD.A. and BautistaA.J.1976. Valuation of financial lease contracts. Journal of Finance31(2): 799–819.
14.
ModiglianiF. and MillerM.H.1958The cost of capital, corporation finance, and the theory of investment. American Economic Review68(2): 261–297.
15.
HurstL.1988. Heads frustrated as fund-raising plans blocked. The Toronto Star: B5. June 5.
16.
KnechtelR.1988. Ottawa move on lease-financing is impractical. The Financial Post: 6. May 25.
17.
CritchleyB. and RegulyE.1988. Leaseback moratorium throws up a few ironies. The Financial Post: 44. June 5.
