Prime Healthcare Acquires Montclair Hospital
Byline: Darla Martin Tucker, The Business Press, July 17, 2006.
By Darla Martin Tucker, The Business Press, July 17, 2006
A Victorville health care company announced July 7 it had acquired Doctor's Hospital Medical Center of Montclair for an undisclosed sum.
The deal between the hospital and Prime Healthcare Services Inc. became official July 1, a release said.
Prime Healthcare will rename the 102-bed facility Montclair Hospital Medical Center and will invest about $10 million in new equipment and renovations, said Prem Reddy, chairman of the Prime Healthcare board. Upgrades will include a new electrical generator, revamped air conditioning, surgical and radiology equipment, "and a lot of other things that haven't been brought up to par in the last several years," Reddy said.
Prime Healthcare will add seven beds to the emergency room for a total 14 beds and will consolidate the obstetrics unit of nearby Chino Valley Medical Center with the unit at Doctor's Hospital, he said. The Chino unit has fewer than 12 employees who will all move to the Montclair hospital, he said.
The administrative, finance, marketing, billing and medical records departments and some lab services of the two hospitals will combine, with most employee positions intact, he said.
Doctor's Hospital has about 400 employees and about 320 physicians.
Prime Healthcare is a health management company that owns Desert Valley Hospital in Victorville, Sherman Oaks Hospital, the Grossmann Burn Center in Sherman Oaks and Chino Valley Medical Center. An Alabama real estate investment firm, Medical Properties Trust Inc., owns the buildings and property of the Sherman Oaks and Chino facilities.
Prime Healthcare closed the deal for Doctor's Hospital in two weeks, in part because Prime Healthcare used its own funds rather than approach lenders, Reddy said.
Doctor's Hospital owner Jonathan Wu approached Prime Healthcare about purchasing the medical center, Reddy said.
Wu purchased hospitals in the Alhambra area and was no longer able to devote time and resources in Montclair, Reddy said. Wu did not return a call seeking comment.
Prime Healthcare is negotiating to purchase "a few other" hospitals in Southern California, although Reddy declined to identify them.
Prime Healthcare presented a proposal to buy Victor Valley Community Hospital, a 115-bed facility that reportedly has received other offers.
The company has not received a firm response on the proposal, Reddy said. "The board of directors at Victor Valley Community Hospital haven't been that friendly with us. It's a strange relationship," Reddy said.
Prime Healthcare took over management of Chino Valley Medical Center in 2004 through bankruptcy proceedings. Reddy committed $50 million on a handshake to pull the hospital out of bankruptcy. He spent $15 million on renovations.
In December, Medical Properties Trust Inc., acquired the medical center's land and buildings for $21 million cash from an affiliate of Prime Healthcare and simultaneously leased it back to the affiliate through a 15-year net lease agreement.