Despite the often strong emotional bond between owners and companion pet animals that would suggest stable revenues, a weak economy and high unemployment pressure sales. This primarily reflects its susceptibility to economic cycles and consumer spending, offset by good market share. We believe that, on a standalone basis, Butler Animal Health Supply has a weak business risk profile. Henry Schein’s increased ownership stake in Butler, and stronger financial resources, contributed to our one-notch increase in Butler’s corporate credit rating in January 2012. We believe Henry Schein has considerably stronger financial resources than Butler Animal Health. Butler aligns well with Henry Schein’s strategic growth objective of expanding its animal health business. “How big you have to be, we don’t know that, but we think this merger of what I consider these two strong, community-based, high-quality organizations will benefit both of us.Strategic owner Henry Schein recently increased its ownership in Butler Animal Health to 71.5%. “It provides us the necessary size and scale to elevate our relevancy and significance in this region’s marketplace,” Sphon said. The combined Excela and Butler Health system will become the third largest health care system in the region, though still remain smaller than both UPMC and AHN. “We felt that was more valuable as we start up this new health system.” You need to be with the people and you need to be present,” Sphon said. “Given the virtual aspects of things and that nature, you can’t lead from behind. The new health system does not plan to have a central corporate office, instead opting to spread its executives across multiple hospitals. “We think it will be an opportunity to attract as well as retain doctors and nurses.” “We’re both large employers in (our) areas, and we think the economic impact will be very important, too, as we try to sustain and face the headwinds that are facing us right now,” he said. Excela is the top private employer in Westmoreland County with about 4,800 employees, and Butler Health System is the largest employer in Butler County and the largest health care employer in Clarion County, employing 3,000 people. Sphon said he hopes the merger will attract additional talent to the new organization’s medical staff, as well as benefit Butler, Clarion and Westmoreland counties’ regional economies. Of our strategic planning moving forward. “We are now in the definitive agreement stage, and when we get to a point of when we close, that is when we can more thoroughly address some Sphon does not anticipate any changes in either organization’s facilities, he said, nor are any immediate changes expected in staffing or types of insurance accepted, though more detailed plans are “something that will be evaluated as we move forward.” “We don’t see that people will have to go somewhere else to receive care, unless there is a specialty area that one area can provide more than another.” “Our physicians and patients will be able to see their same primary care doctor and specialists,” he said. As we combine, we will be able to enhance that.”įor patients, it’s not likely that someone in Excela’s region would need to travel to Butler to see a doctor, Sphon said. “Both organizations provide some very high-quality care in their own right. (We’ll) be able to provide additional services and expand our reach,” he said. “With this merger, it will actually enhance our medical staff. That followed a June 1 announcement and moves the two systems toward finalization of the deal, which is anticipated to bring in more than $1 billion in revenue. Sphon opened up about the plan Friday as the two organizations announced they had entered into a definitive agreement. Excela CEO John Sphon doesn’t expect either patients or staff to experience much of a difference in how they access or provide care as the Greensburg-based hospital system moves forward with a merger with Butler Health System.
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