Marty Rash to serve as Executive Board Chair; Michael Wiechart to serve as President & CEO
New company will have 18 hospital campuses in 12 states with 13,000+ employees
BRENTWOOD, TN and FRANKLIN, TN — March 22, 2023. RegionalCare Hospital Partners Inc. (“RegionalCare”) and Capella Healthcare, Inc. (“Capella”), both privately-owned premier providers of health care services, today announced plans to merge the two companies. The new company will have 18 hospital campuses in 12 states with more than 13,000 employees, 2,000 affiliated physicians and $1.7 billion in revenues. The combined company’s name will be RCCH Health Partners (RegionalCare Capella Healthcare).
Day-to-day operations at the companies’ affiliated hospitals will not be impacted by the parent-company-level transaction.
Capella currently operates ten acute-care and specialty hospital facilities in five states: Arkansas, Oklahoma, Oregon, South Carolina and Washington. RegionalCare owns and operates eight non-urban hospitals located in seven states: Alabama, Arizona, Connecticut, Iowa, Montana, Ohio and Texas.
Marty Rash, current Board Chair and CEO of RegionalCare, will assume the role of Executive Board Chair for the combined company. Michael Wiechart, current Capella Board Vice-Chair and President and CEO of Capella, will lead the new organization as President and CEO. He will also join the combined company’s Board of Directors.
“The merger of our two companies will benefit the communities and patients we jointly serve and better position us for the future,” said Rash. “By creating a single, stronger organization, we’ll have greater scale and stability as well as an expanded geographical reach. As we continue to grow the regional systems we have in place now and to partner with new communities, we’ll continue our progress in meeting the triple aim of improving the experience of care for our patients, expanding access, and providing more efficient care.”
“This is a strategic partnership that will enable both of our companies to enhance service and support to our existing community hospitals while creating a new entity that is even more attractive – and better positioned – for future partner communities,” said Wiechart. “Our companies already share a similar mission and values, including a commitment to providing high quality, compassionate care and building strong regionally-focused delivery systems. Additionally, we each place priority on local leadership with all-local Boards of Directors and a decentralized management approach.”
“We are excited to partner with Michael Wiechart and the Capella team and to facilitate the merger with RegionalCare to launch a new chapter of growth,” said Matthew Nord, a partner at Apollo. “Both companies have developed strong regional networks and have a complementary footprint, with no overlap between markets. Apollo is excited to play a role in uniting these two outstanding companies, and we look forward to working with the leadership of the company to further expand services.”
Financing is being provided by Barclays, Royal Bank of Canada, Deutsche Bank, Credit Suisse, and UBS. In addition, senior unsecured notes are being privately placed with PSP Investments Credit USA LLC and other investors. Barclays served as financial advisor to RegionalCare. Akin Gump Strauss Hauer & Feld LLP and Paul, Weiss, Rifkind, Wharton & Garrison LLP served as RegionalCare’s legal advisors. Kirkland & Ellis served as Capella’s legal advisor.
Apollo Global Management, LLC (NYSE:APO) (together with its consolidated subsidiaries, “Apollo”) is a leading global alternative investment manager with offices in New York, Los Angeles, Houston, Chicago, Bethesda, Toronto, London, Frankfurt, Madrid, Luxembourg, Mumbai, Delhi, Singapore, Hong Kong and Shanghai. Apollo had assets under management of approximately $170 billion as of December 31, 2015 in private equity, credit and real estate funds invested across a core group of nine industries where Apollo has considerable knowledge and resources. For more information about Apollo, please visit www.agm.com.
About Medical Properties Trust, Inc.
Medical Properties Trust, Inc. is a Birmingham, Alabama based self-advised real estate investment trust (REIT) formed to capitalize on the changing trends in healthcare delivery by acquiring and developing net-leased healthcare facilities. MPT, with assets approaching $5.5 billion, is the only REIT whose investment focus is solely on licensed hospitals. MPT’s financing model allows hospitals to unlock the value of their underlying real estate in order to fund facility improvements, technology upgrades, staff additions and new construction. Facilities include acute care hospitals, inpatient rehabilitation hospitals, long-term acute care hospitals, and other medical and surgical facilities. For more information, please visit the company’s website at www.medicalpropertiestrust.com.
About Capella Healthcare, Inc.
Founded in 2005, Capella Healthcare partners with communities to build strong local healthcare systems that are known for quality patient care. Based in Franklin, Tennessee, Capella operates 10 acute care and specialty hospital facilities in five states.
About RegionalCare Hospital Partners Inc.
Founded in 2009, RegionalCare Hospital Partners is a growing system of community hospitals focused on a commitment to high quality care and expanding health care services in non-urban markets. Today, RegionalCare is partnered with eight, market-leading, community hospitals in seven states.