GE strikes $67 million deal with N.Y. system

GE Healthcare Financial Services and GE Medical Systems announced a seven-year strategic alliance with Kaleida Health, Buffalo, N.Y., that would include $67 million in financing for the five-hospital system. Some $47 million of the financing would be tax exempt, subject to regulatory approvals from the U.S. Department of Housing and Urban Development and the New York State Dormitory Authority. Kaleida also would purchase $8 million of performance improvement and leadership development services from GE. A Kaleida official said the deal does not require the system to purchase GE equipment exclusively. GE said the deal took a year to assemble and is the most comprehensive announced since the company appointed a team early this year to pursue strategic alliances with the top 200 U.S. hospital systems. Kaleida, which has been undergoing a turnaround, expects to earn $500,000 on operating revenue of $80 million this year. It lost $13 million in 2002. The financing package would include a 25-year $27 million tax-exempt loan, a five-year $20 million tax-exempt equipment loan and a three-year $20 million line of credit. Proceeds would finance medical equipment purchases and a $30 million renovation at Kaleida's 220-bed Millard Fillmore Suburban Hospital, Williamsville, N.Y. -- by Mary Chris Jaklevic