DRAFTS AND TRADES Former J.C. Bradford banker Kip Caffey, who recently left Atlanta-based Suntrust Robinson Humphrey, is gearing up to start his own boutique investment firm with a group of partners in Atlanta. Healthcare will be one of multiple areas the firm focuses on. More to come later... Head TMA lobbyist Scott Smith is leaving for a post in Arkansas. Smith has been with the organization since the late 1990's. Despite lots of speculation, no final word on who will replace him yet. Psychiatric Solutions has hired longtime HCA executive Ron McClure as Chief Information Officer. Meanwhile, Triad Hospitals is on the hunt for a new CIO following Nick Bonvino's departure. 1 of 6 9/7/07 3:35 PM
DEAL IN PLAY 2 of 6 9/7/07 3:35 PM
Cimplify, the growing health care IT company led by Previous Issues February 2004 March 2004 April 2004 May 2004 3 of 6 9/7/07 3:35 PM
industry veteran Stryker Warren, is on the hunt for acquisitions. Born out of physician practice management firm Urology Healthcare Group, Cimplify has posted impressive gains since its inception last year. The company is pursuing deals that would compliment its existing physician software product offerings. According to Wall Street, Province Healthcare is talking down volumes for the upcoming quarter. The rural hospital chain launched an agressive physician recruitment campaign after an unusually high number of departures ate into volumes and earnings last year. While those new recruits have added to the company's outpatient volume, apparently inpatient gains are expected to post mixed results. Word on the street is that Province may be selling Brim, its hospital management company. Iasis Healthcare is considering building another hospital in East Valley, Ariz. near Phoenix The company, recently bought out by Texas Pacific Group for $1.4 billion, owns St. Luke s Hospital and Mesa General Hospital Medical Center in Phoenix. It bought those facilities from Paracelsus at its inception. Phoenix is a crowded market Banner Health System, Vanguard Health Systems and Tenet are all at play with a tough managed care climate. At its St. Luke s facility, Iasis is building a 60,000 square foot medical office building on its central Phoenix campus and will also spend $6 million to double its ER. Vanguard Health Systems is eyeing plans for a replacement facility in San Antonio, where it owns Baptist Health System. Plans under consideration include the construction of a new hospital and support facilities that would convert Vanguard s Southeast Baptist Hospital into a regional hospital campus. This would expand the facility s scope of services and market share across several southern and eastern counties. In the last edition of Inside Baseball, we reported Vanguard Chairman and CEO Charlie Martin was shopping for an investment banker. We re now hearing a book is circulating on the company. This would free up some of Morgan Stanley's money at play in the nine year old hospital chain, which is expected to go public eventually. No doubt, Iasis' recent valuation caught Morgan Stanley's eye. New Quest Health Solutions, the parent company of HealthSpring, has retained Brentwood Capital Advisors to explore its options. Herb Fritch has enjoyed tremendous success with HMO since purchasing 50 percent of the business then called HealthNet from two local hospitals. Since then, the company Middle s Tennessee Operations have expanded. And, Fritch set up shop in Birmingham and Chicago. 4 of 6 9/7/07 3:35 PM
OUCH... Evolved Digital Systems Inc., the Canadian company that acquired Inphact Inc. last year and merged it with Electromed, lost more than $86 million in 2003. Nashvillian Dick Eskind remains the largest shareholder with more than 14 million shares, roughly 25 percent of the company. Despite those losses, the company's notice to shareholders for the annual meeting shows CEO Jon Lehman, Eskind's son-in-law, and CFO Barry Stewart, received salaries between $264K to more than $300K. (FYI: LifePoint Hospitals CFO Michael Culotta serves on the board of directors, while Dr. Jeff Landman, the former chairman of Inphact, was recently appointed Medical Director.) TOP 10 PHRASES OVERHEARD AT A RECENT INVESTORS CONFERENCE... 10. For many facilities, it s about access to capital 9. Physician recruitment will be a top priority 8. We re looking to stem outward migration 7. We ll pursue 4 6 acquisitions per year in underserved markets with significant population growth 6. Yes, we plan to hire all the employees 5. We will invest in infrastructure 4. And yes, increase the cap ex budget 3. You know, it's basic blocking and tackling 2. We're the sole provider in the community 1. When I was at HCA BOX SCORES If Nashville Healthcare stocks were a mutual fund... 5 of 6 9/7/07 3:35 PM
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