Last fall, Milford Hospital, located in Milford, Connecticut, announced that it was exploring a merger with Bridgeport Hospital, part of Yale New Haven Health.
A week or so ago, Connecticut state legislators spoke in support of Milford’s request for required state approval of the merger, under the terms of which all of Milford’s employees would become Bridgeport employees.
After all, according to a report issued by the officials, “this partnership is necessary to save Milford Hospital….”
“Merger.” “Partnership.” Both are nice words but, here, are simply nice euphemisms.
The deal between Milford and Bridgeport is structured as an asset purchase. Milford isn’t merging with anyone. Milford isn’t partnering with anyone. Milford, as an entity, is ceasing to exist. But yes, at least for now, the physical location will continue to be a hospital.
So what can you learn from this?
First, when you read about facility X or medical group Y “merging” or “partnering” with some other facility or group, don’t necessarily assume that they are breaking out the champagne. What appears to be a happy marriage may not be a marriage at all. What appears to be a date with destiny, rainbows, and unicorns may simply be staving off starvation.
Second, if you are ever in the position of needing, yes, truly needing to be acquired, you are not doing yourself any favor by letting the prospective acquirer know that closing the deal, or, euphemistically, “partnering up,” is necessary to save you. The more you need the deal, the less they need to pay you for it.
Think about it this way: If someone wants to marry you only for your money, would you jump into that relationship?
Comment or contact me if you’d like to discuss this post.
Mark F. Weiss