Concentra Operating Corp., Addison, Texas, agreed to acquire Beech Street Corp., Lake Forest, Calif., for $165 million in cash in a bid to expand its group-health offerings. The deal is expected to close later this year, pending regulatory approval and the arrangement of necessary funding. Privately held Beech Street operates a PPO network of more than 400,000 physicians, 52,000 specialty-care providers and 3,800 hospitals. The company, which caters to employers, unions and government agencies, posted $70 million in revenue for the 12 months ended June 30. Concentra provides cost-containment and case-management services to employers and to occupational, auto-injury and group-health payers. The addition of Beech Street's medical network "offers us the opportunity to achieve significant new revenue growth in both the group-health and workers'-compensation portions of our network-services segment," Concentra President and Chief Executive Officer Daniel Thomas said in a press release. According to the release, Concentra plans to operate Beech Street as an independent unit with its current management. For the first six months of 2005, Concentra earned $32.8 million on $561.8 million in revenue. -- by Laura B. Benko
Concentra to acquire PPO operator Beech Street
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