After many months of negotiations, Community Memorial Hospital will merge with its neighbor, Raiter Clinic, on Jan. 1, the two Cloquet health providers announced.

And they're ready to take on the big new kid in town, the hospital's CEO said.

The hospital's acquisition of the clinic on the other side of Skyline Boulevard became public on Monday after employees of both facilities were informed on Friday. But Rick Breuer, the hospital's CEO, said negotiations began long before rumors started flying that Essentia Health planned to establish a clinic in Cloquet.

Those rumors became fact in August, when Essentia submitted construction plans to the city of Cloquet for a 10,000-square-foot clinic on Minnesota Highway 33, expected to open in May.

If it's a battle for Cloquet, the Community Memorial/Raiter combination will be a David to Essentia's Goliath. Between them, Community Memorial and Raiter have fewer than 500 employees, according to Breuer. According to Essentia numbers as of June 2018, it has well over 14,000 employees with facilities in four states.

Far from being intimidated, Breuer sounds like a CEO who's spoiling for a fight with Essentia.

"I've been in my role here for 20 years in Cloquet," he said. "I've seen what's happened all over the region where they don't serve the communities they go to. They strip the services from the communities they go to and drive them to Duluth. We want to make sure the clinic that they're setting up isn't just a gateway to Duluth."

Breuer confirmed that the deal is an acquisition of the clinic, but he declined to state the price. The name of Community Memorial Hospital won't change, he said, but there could be some change in the naming of the clinic. Nonetheless, the Raiter brand is a valuable asset, he said.

"We have no intention of doing like some facilities do and slapping their names on everything," he said, in another jab at Essentia.

Family practice physicians now at the hospital's clinic will move over to the Raiter building, he said, while surgery-based clinicians all will be at the hospital.

"At Raiter they have spent decades being a family practice clinic," Breuer said. "That's what they're great at. They've had nine physicians and two nurse practitioners. We will be adding another five physicians into that group."

The merger won't take effect until Jan. 1, Breuer said, because of all of the details that need to be worked out in areas such as IT networks and employee benefits.

Dr. Jim Rogers, a Raiter Clinic physician, said he sees the merger as a positive move for everyone.

”It has been a long time coming, and we see it is a win-win-win for the Raiter Clinic, CMH, and for the communities we serve," Rogers said in a news release. "We will now have a unified medical campus that has retained its local independence.”