Statewide: Triad region, November 2014
Red ink and layoffs have become familiar terrain for the state’s hospitals, including Winston-Salem-based Wake Forest Baptist Medical Center, which had a $78.4 million operating loss the past year. “We needed to do something to increase our scale,” CEO John McConnell says. “No one was ready to consider anything like a merger or becoming part of a larger system.” Instead, it announced a shared-services partnership with Greenville-based Vidant Health and Raleigh-based WakeMed Health & Hospitals in September. WakeMed lost $14.4 million this year; Vidant hasn’t reported this year’s results, after a $94.3 million profit last year. Executives started talking earlier this year and agreed on a plan to improve efficiency by sharing purchasing power and data storage. A separate company overseeing the partnership is in the works. The health systems serve different parts of North Carolina, so competition wasn’t a concern. But merging big hospitals has its challenges. “You’ve got a health-care system that’s been built on all these silos of providers and therefore silos of data,” says Jeff Petry, vice president at Charlotte-based Premier, which analyzes clinical and financial data for health-care companies. McConnell says the health systems have studied successful partnerships. “This would not have happened if we didn’t believe we could work together for the common good.”
WINSTON-SALEM — BB&T will acquire The Bank of Kentucky for about $363 million in cash and stock. The Crestview Hills, Ky.-based bank has $1.9 billion in assets and operates 32 branches in northern Kentucky and Cincinnati. BB&T has 1,844 branches in 12 states and Washington, D.C., and about $188 billion of assets. The deal is expected to close in the first half of 2015.
GREENSBORO — Bell Partners and New York-based DRA Advisors sold 20,439 apartment units to Dallas-based Lone Star Funds for $1.8 billion. The properties, which the companies jointly purchased in 2008, will continue to be managed by Bell and are in 64 complexes in the U.S.
GREENSBORO — Cone Health will invest $100 million in a 50,000- square-foot addition to The Moses H. Cone Memorial Hospital — where it will relocate services from its 134-bed local Women’s Hospital, which it is closing — and other projects. The health system will also build a Behavioral Health Hospital to replace its existing one. Both projects are expected to be complete in 2019. The investment also includes operating-room renovations at Wesley Long Hospital that should be done by spring 2018.
BURLINGTON — Laboratory Corporation of America will acquire Raleigh-based LipoScience for $85.3 million. LabCorp provides medical-testing products and services and employs more than 34,000, including more than 6,500 in North Carolina. LipoScience, which develops blood tests for cardiovascular disease and diabetes, employs about 180, including 120 in the state. The deal is expected to close in the fourth quarter.
WINSTON-SALEM — Reynolds American named Debra Crew president and chief commercial officer of its R.J. Reynolds Tobacco subsidiary, effective Oct. 1. She served in various executive roles at Purchase, N.Y.-based PepsiCo since 2010 and replaces Andrew Gilchrist, who became executive vice president of the parent company.
WINSTON-SALEM — Novant Health backed out of acquiring Halifax Regional Medical Center in Roanoke Rapids, saying the current health-care environment isn’t conducive to a merger. The health system had planned to invest $35 million for capital improvements at the 204-bed hospital at the conclusion of a one-year shared-services agreement that began in March. Novant extended its management agreement with Halifax Regional two more years.