PPM/MSO News
April 12, 1999 2 minutes read
PPM/MSO News
• Sheridan Healthcare (Hollywood, FL) plans to sell itself for $155 million to private investors. The investment group includes Vestar Capital Partners of New York, Sheridan CEO Dr. Mitchell Eisenberg, and Executive Vice President Dr. Lewis Gold. The group will offer stockholders $9.25 a share in cash for all outstanding shares, reported the Sun-Sentinel in Fort Lauderdale, FL. NationsBank has committed $75 million to finance the acquisition. Vestar will provide the rest.
• PhyMatrix (West Palm Beach, FL) and its subsidiary, Clinical Studies, has named Michael Heffernan to the role of co-CEO, in addition to his duties as president. Abraham Gosman will remain chairman of the board and will also serve as co-CEO with Heffernan, who joined the company in October 1997. And John Wardle has been named COO for the company’s Provider Network Management business. Wardle most recently served as a senior vice president with United HealthCare of New England. PhyMatrix has also announced that once asset sales are completed, it will change its name to Innovative Clinical Solutions.
• The office of California Gov. Gray Davis is looking into proposals to free bankrupt MedPartners Provider Network (Long Beach, CA) from state control. The proposals would allow the parent company, MedPartners (Birmingham, AL), to pay off about $100 million in debts to doctors and hospitals, and it would require providers to continue caring for the company’s patients and managed care companies to continue sending members to its clinics.
• Vestar Capital Partners (New York) has agreed to lead a $155 million investment in Sheridan Healthcare (Hollywood, FL) that will make the company a private entity. The equity portion of the transaction is $80 million, of which the management group has committed to take as much as an 18% stake, reported Buyouts. NationsBank, the company’s lender, has agreed to provide $75 million in bank debt and a $50 million working capital loan to fund growth plans. The offer should close by the end of 2Q99.
• Florida regulators have joined Colorado and Arizona in investigating Pediatrix Medical Group (Fort Lauderdale, FL) for Medicaid fraud. Pediatrix’s shares fell 15%, and volume was 14 times the three-month daily average, reported the Sun-Sentinel in Fort Lauderdale. Brooks O’Neil, a U.S. Bancorp Piper Jaffray analyst, said he has seen no evidence that Pediatrix did anything illegal. The company announced that earnings would be reduced by about 3 cents per share due to accounting and legal expenses and a change in accounting.
• FPA Medical Management won an increase in debtor-in-possession financing to $55 million from $50 million through a bankruptcy court ruling. The extra money will be used to fund working capital in 2Q99. FPA expects to emerge from Chapter 11 proceedings by the end of May, reported Dow Jones Business News. A hearing to confirm the company’s second amended joint plan of reorganization has been continued to April 21.
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