U.S. Hospital M&A Is Still Healthy

U.S. Hospital M&A Is Still Healthy

Hospitals are the subject of intense national attention this year, thanks to the coronavirus pandemic. When Covid-19 hit hard in March, several hospitals and health systems were overwhelmed with critically ill patients. Elective surgeries were canceled, emergency room and hospital visits plummetted and revenue streams dried up. Congress quickly passed the Coronavirus Aid, Relief and Economic Security Act, which sent $100 billion to healthcare providers in the form of loans and grants. Mergers and acquisitions already underway at the beginning of the year kept moving forward, mostly. The first quarter of 2020 saw 19 transactions reach the definitive agreement stage, the same number reported... Read More »
Banner Health Goes On an Acquisition Spree

Banner Health Goes On an Acquisition Spree

Banner Health, the Phoenix, Arizona-based not-for-profit health system, is bucking a trend. Thanks to the impact of the COVID-19 epidemic in the United States, some healthcare analysts expect 2020 will be a “throw-away year” for earnings and M&A activity. Not so for Banner Health, which owns and operates 28 acute-care hospitals in six states, as well as Banner Health Network, Banner University Medicine, academic and employed physician groups, long-term care centers, outpatient surgery centers and an array of other services. It reported revenue of $2.37 billion in the first quarter of 2020, up from $2.33 billion in the same period in 2019. In August 2019, the system acquired... Read More »
Penn State Health Adds Holy Spirit Health

Penn State Health Adds Holy Spirit Health

For the first time in a few years, Penn State Health is adding another hospital system. The Hershey, Pennsylvania-based not-for-profit signed a definitive agreement to acquire Holy Spirit Health System from Geisinger Health System, another large not-for-profit system based in Danville, Pennsylvania. Geisinger acquired Holy Spirit Health in October 2014. Holy Spirit is anchored by Holy Spirit Hospital (277 beds), a Level II Trauma Center located in Camp Hill, Pennsylvania, southwest of Harrisburg. The deal includes the hospital, its outpatient practices and urgent care centers in Cumberland, Dauphin, Perry and York counties, as well as the Ortenzio Heart Center and the assets of West Shore... Read More »
Steward Health Care Goes to the Docs

Steward Health Care Goes to the Docs

The largest privately held hospital chain in the United States is now owned by a group of physicians who practice there. Steward Health Care System LLC was sold by its founding owner, Cerberus Capital Management, to a management group of Steward Health Care physicians led by the company’s CEO and founder, Dr. Ralph de la Torre. Dr. de la Torre, a cardiac surgeon, was tapped to run Steward’s predecessor, the six-hospital Caritas Christi Health Care in Boston, in April 2008. The current deal was structured as a recapitalization, with no additional leverage added to Steward’s balance sheet and Cerberus’ controlling interest was exchanged for a convertible note. The new... Read More »
U.S. Hospital M&A Is Still Healthy

Adventist Invests in Blue Zones

Adventist Health has acquired Blue Zones, a community-based population health management company that employs a systemic and environmental approach to improving the health of entire cities and communities. The organization’s work in more than 50 communities across America has been credited with double-digit drops in obesity, smoking and Body Mass Index, achieving millions of dollars of savings in healthcare costs. With the new coronavirus pandemic, the deal highlights the attention now focused on health care (or lack of it) in whole communities. The target, based in Minneapolis, Minnesota, infuses healthy choices, enhances connections, instills purpose and fuels hope to impact... Read More »
Banner Health Goes On an Acquisition Spree

Sold, Closed, Resold: The Verity Health Saga

It’s hard enough to go through Chapter 11 bankruptcy proceedings once. Verity Health System, which has had a string of for-profit owners since it was sold by the Daughters of Charity Health System to BlueMountain Capital Management in 2016, is on its second round after a deal fell through last December. It’s just one of several distressed healthcare services stories, sad to say. The latest news came the week ending April 10, 2020, as a federal bankruptcy court judge approved the sale of St. Francis Medical Center (344 beds) in Lynnwood, California to Prime Healthcare Services for $262 million and the sale of St. Vincent Medical Center in Los Angeles for $135 million. The buyer... Read More »