A rural healthcare services company attempting to recover from an aborted stock offering has hired a new chief executive officer to stem the tide of bad news.
Gary Singleton, 51, joined Naples, Fla.-based Community Care of America as president and CEO, replacing Kenneth Creasman, 45, who last week "resigned to pursue other interests," a company statement said. Creasman couldn't be reached for comment.
"We are going to move ahead with the acquisitions that have been announced, and we're seeking alternative financing for others we plan to pursue," said Singleton, who joined CCA after a six-year stint as senior vice president of strategic planning and development at Integrated Health Services of Owings Mills, Md. "We're looking at the recent stock offering as postponed instead of canceled."
CCA delayed a second offering earlier this month in the wake of an investigation of one of its nursing homes in Iowa. CCA, which made its initial public stock offering last year, had planned an offering of 3.1 million shares of common stock in hopes of raising $48.1 million.
CCA's stock plummeted 13% to $10.25 a share in NASDAQ trading March 27, two days after HCFA decertified one of its nursing homes in Council Bluffs, Iowa. HCFA's decision came after the Iowa Department of Inspections and Appeals said a CCA facility failed to correct five violations of healthcare standards. The company is appealing the state's finding.
But Singleton said CCA has made strides to correct the problem and prevent future such incidents.
"The senior management should have been aware that this could have happened, and it shouldn't have come as a surprise to them," Singleton said. "In the long-term-care industry, these situations aren't uncommon, but we need to assure ourselves that this is an isolated incident. We are working on increased clinical training at our facilities."
Meanwhile, CCA expects acquisitions the firm announced last month to close on schedule.
CCA signed a consulting agreement with Memorial Health Services, Adel, Ga., which owns and operates five rural hospitals. CCA has until July to exercise an option to buy those facilities (April 8, p. 29). CCA also signed an agreement to acquire Atlanta-based Southern Care Centers, which operates eight long-term-care facilities in Georgia, Louisiana and Texas. Those deals would give CCA six rural hospitals and 64 long-term-care facilities.
However, Singleton said, a "dozen or so potential deals in the pipeline" will be reviewed. "We will have an acquisition review in the next 30 to 45 days and decide which ones make sense and which ones don't," he added.