Acquisitions, Mergers & Divestitures

Successfully Navigating Hospital Transactions

Spectrum Health Partners’ transaction advisory expertise in the healthcare field adds enormous value in the decision process at those key moments when the correct application of due diligence principles ultimately defines organizational success or failure. Whether Spectrum Health Partners provides a turn-key due diligence solution for a proposed acquisition, or whether we support an ongoing transaction through advisory services such as deal point negotiation or calculation of final net working capital/settlement, our operational depth and financial understanding bring critical insights few firms will match.

More Than 220 Successful Hospital Transactions Completed

Spectrum Health Partners has the high distinction of never having a material adjustment to the Final Net Working Capital Settlement, and we have never had a transaction result in arbitration or litigation. We are not aware of any other firm in the United States than can compare with this record of accomplishment.

Scope of Services

Quality of Earnings Analysis | Download a Sample Report
Spectrum Health Partners:

  • Assesses the target’s revenue with emphasis on payor contract efficiency.
  • Assesses the quality of a target’s earnings to include the identification and quantification of non-recurring, out-of-period, non-cash, or other items that factor into EBITDA.
  • Performs cash-to-net-revenue analysis to support the run rate.

PNWC & FNWC Calculations
Spectrum Health Partners:

  • Calulates both pre-transaction Preliminary Net Working Capital (PNWC) and Final Net Working Capital (FNWC) through settlement.
  • Understands and documents the target’s balance sheet to validate assets and ensure that liabilities are stated properly through settlement.

Contract Reviews
In conjunction with legal representatives, Spectrum Health Partners completes a thorough review of operational, physician, payor and lease contracts to determine which contracts the buyer should assume or not assume.

Business Driver Analysis
Spectrum Health Partners identifies the significant business drivers and trends that impact the business either positively or negatively in anticipation of these and other drivers and trends continuing in the future.

Financial Staff & Systems Evaluations
Spectrum Health Partners:

  • Evaluates the quality of a target’s financial staff.
  • Evaluates the target’s revenue cycle, financial reporting, internal controls and systems utilized to accumulate financial data.

Information Systems Evaluations
Spectrum Health Partners evaluates information system effectiveness to provide ongoing KPI reporting and to meet future demands (HITECH monitoring and reporting).

Operational Reviews
Spectrum Health Partners:

  • Performs in-depth reviews of key departments, including management, staff.
  • Performs a contribution margin analysis of those departments.

Strategic Planning & Board Guidance
Spectrum Health Partners:

  • Develops a strategic planning process to define the best long-term alternative solution for an organization.
  • Provides Board guidance to ensure the best outcome and reporting mechanisms to ensure that the organization stays on track.
  • Quickly identifies changes in direction required to meet market demand.

Opening Balance Sheet Setup & Process Establishment

  • For completed acquisitions, we establish the opening balance sheet setup.
  • We also establish ongoing an reconciliation process and audit schedule.

Integration of Operational & Financial Systems
With experience gained in managing over 180 transactions, Spectrum Health Partners is able to perform operational and financial integration of the acquisition to the buyer’s organization.

Physician Gap Analysis
Spectrum Health Partners determines recruitment needs based on client’s strategic plan goals.

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