Arizona's largest hospital system, Banner Health, is getting much bigger.

Officials of Banner Health and Sun Health announced at a Sept. 21 news conference that the two hospital systems will merge. Banner Health, the state's second-largest employer with a staff of 20,500, will add Sun Health's 4,500 employees and two hospitals in the West Valley to its eight existing hospitals throughout the Valley.

As part of the merger, Banner will also assume control of Sun Health's research operations, including Sun Health Research Institute. Banner already operates the well-respected Alzheimer's Institute. Dr. Joseph Rogers, president and senior scientist for Sun Health Research, told the Arizona Republic that the two research arms will remain distinct for now, but may join their operations in the future.

"We are very excited for this," Rogers told the Republic. "We think it provides great opportunity for collaboration."

"This merger is being pursued for very positive reasons — the desire to join with a well-respected, locally based organization that shares our vision of enhanced services for the community's overall benefit," said Leland W. Peterson, President and CEO of Sun Health. "It is critically important to meeting the challenges of the rapidly growing west Valley's increased healthcare needs and fast-paced technological advances."

"The community benefits we will be able to provide through this transaction are profound, as this proposal supports a vision of enhanced patient care in the west Valley that includes continued expansion of facilities, expedited acquisition of new technologies such as electronic medical records, and enhanced education and training opportunities dedicated to providing excellent patient care," said Peter S. Fine, President and CEO of Banner Health.

The due-diligence process and regulatory review to approve the merger should last six to nine months.

Hospital officials said that while bringing the companies together would create some duplication of services, they did not expect the combined company to shed jobs.

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For more information:

"Banner Health merges with Sun Health," The Arizona Republic, 09/21/2007

"A Banner Day," Daily News-Sun, 09/21/2007

Banner Health news release, 09/21/2007