WATERBURY – The Greater Waterbury Health Network (GWHN), the parent company of Waterbury Hospital, today announced that it has signed a Letter of Intent (LOI) to be acquired by Prospect Medical Holdings (Prospect) of Los Angeles, CA. Prospect Medical Holdings, Inc. is a privately owned healthcare services company that owns and operates 13 hospitals, with a total of 2,258 licensed beds, as well as 40 clinics and outpatient centers in diverse, high-density population areas within five markets in California, Texas, and Rhode Island.
“We believe that an innovative healthcare company that is able to work through the challenges of the changing healthcare industry and is a strong capital partner is a key component of the long-term strategy for high quality, sustainable healthcare in the Greater Waterbury region,” said Carl Contadini, chairman of the GWHN Board of Directors. “We believed it in 2010 when we started this process and we believe that today.”
Under terms of the LOI, GWHN will sell substantially all of its assets to Prospect Medical Holdings.
“Today, we are focused on a parallel strategy of strengthening the services of GWHN while working toward this partnership,” said Darlene Stromstad, FACHE, president/CEO of Waterbury Hospital. “We are proud of our successful efforts to reduce costs, bolster our technology and state-of-the-art equipment, and rebuild and reorganize our organization. Our two-part strategy will ensure GWHN’s rightful place as the premier healthcare organization in the region.”
Financial terms of the acquisition were not disclosed. Stromstad said Prospect Medical Holdings was chosen because of its “coordinated regional care” approach to healthcare, which will strengthen and enhance access to and the delivery of high quality, cost-effective services for the community. Second, the company has a keen focus on collaborating closely with physicians, medical groups, community providers, payers and other key stakeholders such as labor unions. Third, Prospect offers a wealth of experience and brings advanced solutions for the coordination of care and population health. And, Stromstad noted, Prospect also has a proven track record of moving through the regulatory process successfully because of experience in the highly regulated Rhode Island healthcare market.
As part of the transaction, Waterbury Hospital plans to expand its range of outpatient services to the communities it serves while making upgrades to the hospital’s main campus. The transaction also will allow the hospital to enhance its strong record of attracting and maintaining top-quality physicians.
With the Letter of Intent in place, the two organizations will now engage in due diligence of both parties, and work on creating a Definitive Agreement and prepare for the Certificate of Need process, which will be necessary for approval from the Connecticut Office of Health Care Access and the Office of the Attorney General. The transaction also will require approval from certain state and federal regulatory agencies.
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