Paracelsus to merge with Houston company: combined entity will then be publicly traded.PASADENA - Closely held A phrase used to describe the ownership, management, and operation of a corporation by a small group of people. In a closely held corporation, the same people often act as shareholders, directors, and officers, and no outside investors exist. Paracelsus Healthcare Corp. agreed last week to merge with Houston-based Champion Healthcare Corp. and convert to a publicly traded company publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. . Each Champion common share will be converted into one share of the new Paracelsus stock, while its preferred issue will be converted to two shares of the stock. After the transaction is completed, Champion shareholders will own about 40 percent of the stock. The remaining 60 percent will be in the hands of Chairman Manfred George Krukemeyer and other top-level managers at Pasadena-based Paracelsus. Krukemeyer has been Paracelsus' sole shareholder. Company officials did not return phone calls seeking comment last week, but analysts believe the transaction will give Paracelsus greater access to capital and allow it to remain independent in a market that has become dominated by large, acquisitive players such as Tenet Healthcare Corp., OrNda Healthcare Corp. and Columbia/HCA Healthcare Corp. Headed for Amex "What they're doing is tapping into the equity market when the health care industry is hot," said Steve Valentine, president of the Camden Group, an El Segundo-based consulting firm. "They can jump on the whole rising tide and probably come out with a very good capitalization." The new issue is expected to trade under the Paracelsus name on the American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. , according to a joint statement issued by the companies last week. No relevant documents filed with the Securities and Exchange Commission were available last week. Valentine noted Paracelsus has not been growth-oriented in the past, and may be rethinking its strategy toward expansion. The transaction will add 10 hospitals to Paracelsus' current roster of 21. They operate in 11 states, including California, Texas and Tennessee. The combined firm will have pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma annual revenues of about $670 million and net income of $16 million to $17 million. Krukemeyer will remain chairman of the combined company, while Paracelsus CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Ronald J. Messenger will retain his position and be named vice-chairman. Charles R. Miller Charles Robert Miller (September 30 1857 – September 18 1927) was an American lawyer and politician from Wilmington, in New Castle County, Delaware. He was a member of the Republican Party, who served in the Delaware General Assembly and as Governor of Delaware. , Champion's chairman and CEO, will become Paracelsus' president and chief operating officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , and also have a seat on the board of directors. Champion's executive vice president and chief financial officer, James G. VanDevender, will retain those titles at Paracelsus. |
|
||||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion