A hospital almost forced to close because of spiralling costs has succeeded in bringing itself back from the brink.

The privately-run King Edward VII Hospital in Midhurst treats between 6,000 and 7,000 inpatients a year, 40 per cent of them local NHS patients.

Two years ago the hospital had piled up losses and staff morale had hit rock bottom.

Director of marketing Karen Orchard said: "The problem arose some years ago with budget cuts followed by the influx of competition from other hospitals.

"We decided to concentrate solely on areas of excellence and selected four key services to concentrate on - cancer, cardiology, specialist orthopaedic and elective surgery."

The hospital sold some of its buildings for housing development and invested in more facilities.

King Edward VII is now the only independent hospital in England outside London with its own radiotherapy unit.

Dozens of patients from West Sussex and parts of Surrey and Hampshire have benefited from the unit's technology.

The finishing touches are also being made to a brand new theatre which will be vital for the diagnosis and treatment of heart disease.

A brand new theatre is to be completed in 2002 will provide access to the best technology available in the diagnosis and treatment of heart disease.