Carilion Clinic has agreed to merge its for-profit lab business with Spectrum Laboratory Network, a Greensboro, N.C.-based portfolio company of Welsh Carson Anderson & Stowe. The combined company would have around 2,600 employees and more than $300 million in annual revenue. As a precursor, Carilion will spin out diagnostic consulting group Chi Solutions into an independent company.
Chi Solutions, Inc. (Chi), the largest diagnostic consulting company, owned by Carilion Clinic, announced today that the parties have agreed to general terms wherein Chi will be acquired by current management, Kathy Murphy, PhD and Earl Buck. It is anticipated that the acquisition will be completed in early 2010.
Chi is a healthcare consultancy focused on delivering cost savings, new revenue, and optimized operations for laboratory, imaging, and other diagnostic departments. Carilion Clinic acquired Chi in 2005 to support its laboratory growth strategy. Under the leadership of Kathy Murphy, PhD, president, and Earl Buck, MT(ASCP), vice president, the company has prospered and added new service offerings including Lean Six Sigma and Mergers and Acquisitions. Long recognized as the market leader in laboratory outreach, Chi has developed a new diagnostic model for growth of imaging and other diagnostic services.
“The management buy-out will allow Chi to go back to its legacy as a private, independent consultancy. This allows us to work with a broader range of clients without any perception of a conflict of interest,” said Dr. Murphy.
Earl Buck commented, “Current Chi clients will not see any change in service post-acquisition. The company will deliver the same services with the same resources that they have come to know and trust.”
Further details will be released after the close of the Chi transaction.
About Chi Solutions, Inc.
Founded in 1983, Chi Solutions, Inc., (Chi) is a nationally recognized healthcare consultancy focused on delivering cost savings and identifying opportunities for new revenue streams and optimized operations for hospitals, freestanding laboratories, imaging centers, and outpatient centers. Chi works collaboratively with its clients to visualize, strategize, and achieve measurable objectives and deliver proven outcomes. Chi’s clients and industry partners benefit equally from the company’s unparalleled market research capabilities and an extensive proprietary database that identifies and defines industry trends and consistently provides a level of service unmatched in the industry. Chi’s expertise includes: Strategic Planning, Outreach, Operations Improvement, Compliance, Benchmarking, Lean Six Sigma, Outsourced Sales and Management Services, and Mergers and Acquisitions. With an unwavering commitment to excellence through knowledge, Chi helps its clients achieve business objectives and identify ways to efficiently deliver the highest level of patient care. For additional information, visit www.chisolutionsinc.com or call (800) 860-5454.
About Carilion Clinic
Carilion Clinic, a regional not-for-profit integrated delivery system, is headquartered in Roanoke, Virginia, and is the current owner of a for-profit laboratory company, Carilion Labs. The Chi management buy-out compliments Carilion’s strategy to merge Carilion Labs with Spectrum Laboratories. The private equity group Welsh, Carson, Anderson and Stowe (WCAS) and Carilion Clinic will have majority and minority ownership stakes, respectively, in the new laboratory company. For more information, please visit the Carilion website at www.carilionclinic.org.