WakeMed Health and Hospitals of Raleigh, N.C., has submitted an unsolicited offer to purchase rival Rex Healthcare from the UNC Health Care system for $750 million.
The May 12 offer came as a surprise to Rex, said Dale Jenkins, Rex’s chairman of the board of trustees, in a recorded press conference. He said he considers it a hostile taekover.
“We’re a bit perplexed by the offer,” he said.
While Rex is not for sale, the board will consider the offer, but Jenkins said he doesn’t believe a sale of Rex to WakeMed is in the best interests of Rex or the local community. “UNC is a better partner for Rex than WakeMed would be,” he said.
WakeMed’s offer letter said the acquisition proposal has been under consideration by its board for several months. The letter says healthcare consumers in the community would benefit from the purchase because it would eliminate duplication of services, provide a better integrated system for improved continuity of care, and offer a larger range of services and more access to care.
The letter also states the sale of Rex to WakeMed would provide a “significant” return on investment for North Carolina and the UNC Health Care system. Jenkins responded that any cost savings to the state would be short-term and not worth the long-term impact.
WakeMed is a private, not-for-profit healthcare organization with an 870-bed system of facilities throughout Wake and Johnston counties.
The News & Observer said WakeMed’s hostile takeover bid is an effort by the healthcare system to counter UNC’s “predatory expansion tactics.”
[See also: North Carolina health systems spar over Research Triangle physicians, patients.]