Health Management Associates HMA (NYSE), a leading provider of acute care services in rural communities, announced the promotion of Mr. Burke W. Whitman to Chief Executive Officer, effective June 1, 2007. The current CEO and Vice Chairman, Joseph V. Vumbacco has served as CEO for over six years. Vumbacco will continue as Vice Chairman and will assume new responsibilities including consulting on construction projects, legal issues and Federal and state governmental relations.
Whitman's promotion appears to be a positive move for the company. He has had extensive experience in the health management related field successfully handling a variety of executive positions at different companies (e.g., Columbia/HCA Healthcare Corp., Triad Hospitals, Investment Banker with Morgan Stanley). He initially came to HMA back in January, the same time a major recapitalization program had been announced. Whitman was hired to be the company's President and Chief Operating Officer. In January, the company announced a sizable recapitalization of its balance sheet. The recapitalization was designed to reduce HMA’s overall cost of capital, enabling it to achieve a more optimal capital structure. As part of the recapitalization, HMA returned over $2 billion to shareholders through a $10.00 per share one-time special cash dividend that was payable on March 1, 2007 to shareholders. HMA’s common stock started trading on the ex-dividend basis March 2, 2007, the date after the payment date. The stock has followed a stable path since the dividend payment.
Whitman's promotion can be expected to be a smooth transition. Keep a close eye on Whitman and how Health Management Associates performs over the next six to twelve months.