Tenet to Acquire Vanguard in Surprise $4.3B Deal
Tenet management apparently is not overly concerned with Texas Gov. Rick Perry's bar-the-door refusal to expand Medicaid coverage. "The State of Texas has roughly 30% of its residents not covered by insurance today," Fetter told CNBC.
"Eventually we believe those residents will be covered by one form of insurance or another, and that will create substantial growth opportunities for hospital operators in Texas and very materially Vanguard's portfolio is located in the high growing markets of San Antonio and South Texas, particularly Harlingen and Brownsville. It is very appealing to us. We have a strong presence in Texas already, and together we will nearly double our revenues in the state."
Fetter told CNBC that the Vanguard acquisition "marks a turning point for the company in which we'll be more aggressive in acquisitions."
"We have been building our outpatient portfolio. We have doubled that through acquisitions in the last few years, and we have been building our services portfolio through acquisitions," Fetter said. "This is the first big acquisition we have done in a very long time in acute care hospitals. It will not be the last. One of the skills that Vanguard brings to the table is that they're known as a very good acquirer and partner to not-for-profit health systems and so I look forward to expanded acquisition pipeline in the acute care business."
John Commins is a senior editor with HealthLeaders Media.
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