Mid-Atlantic acquires Covenant Care of Pa. Move adds to holdings 8 assisted-living sites

Health care

January 31, 1998|By M. William Salganik | M. William Salganik,SUN STAFF

Mid-Atlantic Healthcare Partners Inc., a Timonium start-up, announced yesterday that it had completed the acquisition of Covenant Care Corp., which operates eight assisted-living facilities in Western Pennsylvania.

Terms were not disclosed.

This is the first step toward making Mid-Atlantic "a leading regional provider" of assisted living, skilled nursing and related services, said Daniel A. Hirschfeld, president and chief executive officer.

The company was formed last year by Hirschfeld and David Yungmann, each of whom have worked for several long-term care providers.

In addition to Covenant's eight facilities with 850 beds, Mid-Atlantic expects to close between April and June on agreements for five more assisted-living facilities with 375 beds, Hirschfeld said. He said the company is negotiating to pick up other assisted-living and skilled-nursing facilities and a home health company.

The company's business plan, the CEO added, calls for adding nearly 2,000 beds this year and about 1,200 beds a year thereafter. By 1999, he said, Mid-Atlantic may be in a position to develop some of its own new facilities, but first it needs to build a base of already operating buildings.

He said Mid-Atlantic would concentrate on smaller markets, such as Hagerstown, where it can acquire facilities at "middle market" prices. He said Medicaid and Medicare programs and managed-care insurers are beginning to pay for assisted living, but would not pay high enough rates to make it worthwhile to acquire top-of-the-market facilities.

Hirschfeld said Mid-Atlantic would be seeking financing through a private placement this year and, as it grows, might do a public offering in "a couple of years."

Pub Date: 1/31/98

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