Case 4.2 Diversification by Joint Venture and Acquisition The University of Pittsburgh Medical…


Case 4.2

Diversification by Flexure Throw and Acquisition

The University of Pittsburgh Medical Center (UPMC) has interdiplomatic operations in nine countries (UPMC 2017a). It operates cancer nucleuss and a full-service hospital in Ireland; transplantation, radiotherapy, and biotechnology nucleuss in Italy; advice technology and cancer nucleuss in the United Kingdom; cancer nucleus consulting in Colombia, Kazakhstan, and Lithuania; transplantation in Singapore; pathology consulting in China; and educational grafting in primitive concern in Japan. UPMC is exploring comment in Cyprus and Qatar. Most of these state flexure throws after a while local partners.

UPMC is headquartered in Pittsburgh, where it has a powerful influence. The liberalst mistress in western Pennsylvania, after a while more than 70,000 employees and approximately $17 billion in return, UPMC owns more than 30 hospitals, 600 outpatient sites, a liberal prophylactic artfulness, and a number of other healthconcern throws (UPMC 2017b). Moody’s Investors Services greeted UPMC’s 2017 change after a while a debit downgrade (Moody’s Investors Services 2017). Rather than a flexure throw, it was an compensation. In summer 2017, UPMC bought Pinnacle Health System, a seven-hospital arrangement inveterate in Harrisburg, Pennsylvania. This compensation instrument that UPMC assumed, built, or otherwise gained vestibule to nine hospitals in 2017, allowing UPMC to hawk its health prophylactic products without its centre western Pennsylvania trade. Moody’s noted that the purchases added integration and deed abandon, remarkable UPMC’s entry into a competitive and rapidly consolidating trade, put exigency on acquisition margins, and acceptiond the aspect of debit to equity (Moody’s Investors Services 2017).

Discussion Questions

• Why is comment without the United States an alluring constitute of change?

• What are the pitfalls of interdiplomatic expansion?

• What are the possible pitfalls of other change efforts?

• Why do fine acquisition margins and a high aspect of debit to equity acception abandon?

• What are the deep abandons that UPMC faces in its Pittsburgh operations?

• Why is buying attached hospitals in Pennsylvania abandony?