Merger creates new and stronger regional hospital laboratory company
ROANOKE, Va. — Carilion Labs has entered into an agreement to merge with Greensboro, North Carolina-based Spectrum Laboratory Network to form a major laboratory company offering comprehensive clinical, anatomic pathology and esoteric testing services.
The merger will create a new and stronger regional hospital laboratory company, serving 37 hospitals and 14,000 physicians in eight states, with more than 2,600 employees and annual revenues above $300 million. Carilion Clinic will own 33 percent of the new company. Carilion’s President and CEO, Edward G. Murphy, M.D., and two other Carilion appointees will sit on the board. Novant Health, a minority owner in Carilion Labs, will remain an equity owner in the new company and will also hold a seat on the board. The company will be jointly headquartered in Roanoke, Va. and Greensboro, N.C. The pending merger, which was facilitated by Carilion Labs’ financial advisor Lazard Middle Market LLC, follows the purchase of Spectrum by Welsh, Carson, Anderson and Stowe (WCAS), a private equity firm with experience in the health care and laboratory industry.“A new company that combines the strengths and shared values of Carilion and Spectrum with a focus on hospital laboratory services will significantly improve services to our customers and their patients, and provides a strong platform for further expansion within the region and across the nation,” said Dr. Murphy.David Weavil, a 30-year veteran of the laboratory industry will serve as the new company’s Chief Executive Officer.”We are excited to be partnering with the Carilion Clinic and David Weavil, a long time lab industry executive. We have a proven track record of partnering with not-for-profit health care systems to help them expand their delivery systems and reach within their medical community. Carilion Labs and Spectrum Laboratories each have an excellent reputation with clinicians for providing excellent clinical and anatomic pathology services and we hope to continue to build on that reputation and bring the approach to other communities,” said WCAS General Partner Sean M. Traynor.Following regulatory approval, the merger is expected to close by the end of February, 2010.
About Carilion Clinic
Carilion Clinic is a multi-specialty healthcare organization with more than 600 doctors and eight hospitals, based in Roanoke, Va. Led by physicians, Carilion Clinic is committed to clinical excellence, education and research. Carilion Clinic is dedicated to providing care that is centered on the patient’s needs, supported by an ongoing commitment to quality and service. With nationally recognized specialists, award-winning nurses, the latest technology and state-of-the-art facilities, Carilion Clinic is bringing tomorrow’s healthcare into focus today. For more information, please visit www.CarilionClinic.org.
About Spectrum
Spectrum Laboratory is a regional medical laboratory network supporting over 7,000 physicians by performing over 30,000 individual tests each day. Headquartered in Greensboro, North Carolina, Spectrum provides hospital quality testing to five states including North Carolina, South Carolina, Georgia, Tennessee, Virginia, and the DC area. Service, integrity and commitment are the hallmarks of Spectrum Laboratory Network. For more information, visit www.spectrumlab.org.
About WCAS
Welsh, Carson, Anderson & Stowe is one of the largest and most successful private equity firms focused on investing in the information/business services and healthcare sectors. Established in 1979, WCAS manages total capital of over $20 billion and specializes in buying growth businesses in its target industries and building value through both internal growth and acquisitions, resulting in superior returns for its investors.
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