Carilion Labs has entered into an agreement to merge with Greensboro, N.C.-based Spectrum Laboratory Network to form a major laboratory company offering comprehensive clinical, anatomic pathology and esoteric testing services.The merger will create a new and stronger regional hospital laboratory company, serving 37 hospitals and 14,000 physicians in eight states, with more than 2,600 employees and annual revenues above $300 million. Carilion Clinic will own 33 percent of the new company.
Carilion President and CEO Edward G. Murphy, M.D., and two other Carilion appointees will sit on the board. Novant Health, a minority owner in Carilion Labs, will remain an equity owner in the new company and will also hold a seat on the board. The company will be jointly headquartered in Roanoke and Greensboro.
The pending merger, which was facilitated by Carilion Labs' financial advisor Lazard Middle Market LLC, follows the purchase of Spectrum by Welsh, Carson, Anderson and Stowe (WCAS), a private equity firm with experience in the health care and laboratory industry.
“A new company that combines the strengths and shared values of Carilion and Spectrum with a focus on hospital laboratory services will significantly improve services to our customers and their patients, and provides a strong platform for further expansion within the region and across the nation,” says Dr. Murphy. David Weavil, a 30 year veteran of the laboratory industry will serve as the new company’s CEO.
Following regulatory approval, the merger is expected to close by the end of February, 2010.
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