Prospect Receives $1.55B Investment from Medical Properties Trust - Does Not Impact RI’s CharterCare
Tuesday, July 16, 2019
On Monday, Prospect Medical Holdings, Inc. announced that Medical Properties Trust, Inc. (MPT) will invest $1.55 billion in Prospect through a sale-leaseback of the company’s real estate assets in California, Connecticut and Pennsylvania.
Prospect’s properties in Rhode Island, New Jersey, and Texas are not included in the transaction. There will be no impact on CharterCare in Rhode Island that owns and operates Roger Williams Hospital, Fatima Hospital, and other healthcare services.
This is just the latest transaction in the ever-changing world of healthcare. In total, Prospect operates 20 hospitals across six states.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTAccording to the company, Prospect will use the funds to retire the company’s existing term-loan debt. Prospect will continue to own and operate all its hospitals and ancillary operations in California, Connecticut, Pennsylvania, Texas and New Jersey as well as its Rhode Island joint venture. The transaction is expected to close in the second half of 2019, subject to customary closing conditions.
“This transaction allows us to unlock the value of those assets and focus our efforts on our core business – operating hospitals and implementing our Coordinated-Regional-Care population health model,” said Samuel S. Lee, Chairman of the Board and Chief Executive Officer of Prospect Medical Holdings, Inc.
“In addition to strengthening Prospect financially, having MPT available for long-term capital provides us with a significant and experienced potential source of funding for improvements to our existing facilities as well as for future acquisitions and other growth opportunities,” said Lee in a statement.
The MPT investment is in addition to the $200 million of investments in medical equipment, facility upgrades, and technologies that Prospect has made in its hospitals over the last three years. These investments support the company’s emphasis on clinical quality and have led to improvements at many of its hospitals.
“We believe this investment by MPT is a strong validation of our Coordinated-Regional-Care model and an endorsement of our ability to continue providing quality, compassionate, safe care at our hospitals and other facilities. At our current scale of approximately $3 billion of annual revenues, this transaction provides Prospect with the long-term platform necessary to improve and expand. We will intensify our focus and resources in our existing markets – where we can expand and drive more growth – to provide quality, cost-effective, coordinated care through our comprehensive network of hospitals, medical groups, and ancillary facilities,” said Lee.
Prospect nationally has academic medical affiliations with: • Boston University Medical School • Brown University Alpert Medical School • UCONN School of Medicine • Drexel Medicine • Philadelphia College of Osteopathic Medicine • NYU Langone Health • Quinnipiac University Frank H. Netter MD School of Medicine • University of New England College of Osteopathic Medicine • Yale University School of Medicine
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