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10 Things to Know About Prime Healthcare Services

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erica mary
10 Things to Know About Prime Healthcare Services

Prime Healthcare appears to be using an aggressive merger and acquisition strategy to expand its presence.

Recent deals include an agreement to acquire Garden City (Mich.) Hospital, the purchase of Landmark Medical Center in Woonsocket, R.I., and the planned acquisition of several New Jersey hospitals, including Saint Michael's Medical Center in Newark and Saint Mary's Hospital in Passaic.

Although industry experts have observed some larger for-profit hospital operators are becoming more selective in the smaller providers they acquire, Prime Healthcare seems to still be willing to take on financially troubled facilities.

For example, Saint Mary's Hospital — which Prime Healthcare has applied to acquire— has been struggling financially for a number of years and currently has about $39 million in long-term outstanding debt and $5.1 million in a working capital line of credit.

This past September, the hospital operator issued $475 million in debt, partly to help finance its hospital acquisitions.

The debt was broken down into a $250 million senior secured term loan and a $225 million asset-based credit facility, with the term loan going toward acquisition financing.

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