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COLUMBIA HEALTHCARE CORPORATION AND HCA - HOSPITAL CORPORATION OF AMERICA ANNOUNCE PLANNED MERGER

 LOUISVILLE, Ky. and NASHVILLE, Tenn., Oct. 2 /PRNewswire/ -- In a merger creating the nation's largest healthcare provider, Columbia Healthcare Corporation (NYSE: COL) and HCA-Hospital Corporation of America (NYSE: HCA) today jointly announced the signing of a definitive agreement to merge in a tax free stock-for-stock transaction.
 Under the terms of the merger agreement, unanimously approved today by the boards of both companies, HCA shareholders would receive 1.05 shares of Columbia common stock in exchange for each HCA share held. Following the merger, there will be approximately 338.2 million shares of Columbia's common stock outstanding. It is anticipated that the proposed merger will be tax free to HCA shareholders and accounted for as a pooling-of-interests.
 Columbia will be renamed Columbia/HCA Healthcare Corporation, will own and operate 190 hospitals with over 42,000 licensed beds located in 26 states and 2 foreign countries, with expected annual revenues of over $10 billion. Corporate offices will be maintained in Louisville, KY, and Nashville, TN. A committee of the board of directors has been appointed to determine, promptly following the merger, the location of the Company's corporate office.
 The companies anticipate annual savings of $130 million ($75 million of which could be achieved in 1994) resulting from combined national purchasing contracts and credit access, the reduction of duplicative functions and the consolidation of administrative programs. By leveraging economies of scale and increased efficiencies due to strong market presence, the companies believe they can greatly reduce healthcare costs while maintaining quality patient care.
 In a joint statement, Richard L. Scott and Thomas F. Frist, Jr. M.D., Columbia's and HCA's Chief Executive Officers, respectively, noted that the benefits of the proposed merger between the two companies offered tremendous opportunities to grow in today's healthcare environment. "The combination is a proactive response to healthcare reform which will enhance our relationship with managed care plans due to broad geographic coverage and cost efficiency, and broaden the markets in which the separate companies currently operate. The direction of healthcare delivery in the future will focus on quality results and cost efficient operations, and we believe this transaction strengthens our efforts toward this goal."
 If the merger is consummated, it is expected that Thomas F. Frist, Jr. M.D. will be the Chairman of the Board, Carl F. Pollard will be the Chairman of the Executive Committee, and Richard L. Scott will be the President and Chief Executive Officer responsible for day-to-day operations. The combined entities' boards of directors will consist of the 11 current Columbia directors
and four HCA directors. It is currently anticipated that Columbia/HCA will continue its existing dividend policy of $0.03 per share per quarter
 The transaction is conditioned upon confirmation that the transaction qualifies as a pooling-of-interests and approval by shareholders of both companies. Shareholders meetings to vote on the proposed merger transaction are anticipated near the end of 1993. Merrill Lynch is serving as financial advisor to Columbia and has rendered a fairness opinion to Columbia's board of directors. Goldman, Sachs & Co. is serving in the same capacity to HCA and has rendered a fairness opinion to HCA's board of directors with respect to the proposed combination.
 Columbia currently operates 94 acute-care and specialty hospitals with 21,627 licensed beds, and HCA currently operates 96 acute-care and specialty hospitals with 20,485 licensed beds. Additionally, both companies operate complementary outpatient facilities.
 -0- 10/2/93
 /CONTACT: Investor Contact - Lee A. Wood, Columbia Healthcare Corporation, 502-572-2115, Victor L. Campbell, HCA-Hospital Corporation of America, 615-320-2053; Press Contact - Lindy B. Richardson, Columbia Healthcare Corporation, 502-572-2153, David L. McFadden, HCA-Hospital Corporation of America, 615-320-2056/
 (COL HCA)


CO: Columbia Healthcare Corporation; HCA-Hospital Corporation
 of America ST: Kentucky, Tennessee IN: HEA SU: TNM


DF -- CHSAOO1 -- 8133 10/04/93 07:59 EDT
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Publication:PR Newswire
Date:Oct 4, 1993
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