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COLUMBIA HOSPITAL AND BASIC AMERICAN MEDICAL AGREE TO A PROPOSED STRATEGIC MERGER

 COLUMBIA HOSPITAL AND BASIC AMERICAN MEDICAL AGREE
 TO A PROPOSED STRATEGIC MERGER
 FORT WORTH, Texas, April 27 /PRNewswire/ -- Columbia Hospital Corporation (NASDAQ: CHOS) and Basic American Medical, Inc. (NASDAQ: BAMI) today announced that Columbia has agreed to acquire Basic American Medical, Inc. through a merger transaction that has been approved by the board of directors of both companies. Based upon the current market price of Columbia's common stock, consideration to be paid for Basic American's shares totals approximately $185 million.
 Under the terms of the proposed merger, which is subject to the approval by the shareholders of Columbia and Basic American and certain other conditions, each Basic American shareholder will exchange 1.0 share of common stock for 1.1 shares of Columbia's common stock in a tax-free exchange. Each Basic American shareholder will be provided the opportunity to receive a portion of the exchange amount in cash. This option will permit Basic American shareholders to receive $6.00 per share in cash with the balance in Columbia common stock. Basic American shareholders electing the cash option will be taxed on the cash portion of the exchange value.
 Based in Fort Worth, Texas, Columbia Hospital Corporation currently operates 11 general acute-care hospitals and two psychiatric hospitals with 2,815 licensed beds in five markets. A leader in healthcare services in Miami, Fla. and El Paso, Texas, the Company recently announced a major expansion in the Houston market with the signing of an agreement to purchase two additional hospitals. Columbia also owns various related businesses in its markets, including outpatient diagnostic centers, outpatient physical therapy centers, outpatient surgery centers, a cardiac rehabilitation/wellness center, lithotripsy services and an outpatient radiation therapy center. Additionally, Columbia owns Sutter Corporation, which markets orthopedic rehabilitation equipment and services for use in both the home and the hospital.
 Basic American Medical Inc., based in Indianapolis, Indiana, owns seven general acute-care hospitals with 1,163 licensed beds. Basic American's assets and revenues are primarily associated with its four hospitals (874 beds) located in Southwest Florida, centered around the Ft. Myers market area. Basic American also owns a medical products company, a rehabilitation services provider, and a healthcare prescription services company.
 "We believe the merger of Columbia and Basic American is a strong strategic move for both companies," said Richard L. Scott, chairman and chief executive officer of Columbia. "We share similar values of providing high quality healthcare services, by operating facilities in a physician and patient responsive manner and by committing significant capital to each hospital to remain at the forefront of medical technology.
 "We are very impressed by the quality of Columbia's management team and their strategy of becoming a significant provider of comprehensive healthcare services in targeted markets," said Ethan Jackson, chairman of Basic American. "We believe this strategy is consistent with the success Basic American has had in its primary market in the Ft. Myers, Florida area."
 Columbia's President and Chief Operating Officer, David T. Vandewater said, "We anticipate few management changes in the combined organization. However, we expect to realize certain economies by consolidating the two corporations.
 In 1991, Columbia reported net income of $14.9 million, or $0.90 per share, while Basic American reported net income of $100.1 million, or $1.22 per share. After consummation of the merger, Columbia expects to have revenues in excess of $1 billion on an annual basis.
 The companies expect to file a proxy and registration statement related to the proposed merger with the Securities and Exchange Commission by the end of May. Shareholder meetings to approve the merger are expected to be held in late July.
 -0- 4/27/92
 /CONTACT: Stewart J. Campbell of Columbia Hospital Corporation, 817-870-5900, or Brady R. Justice of Basic American Medical, Inc., 317-787-2400; or Anthony J. Russo or Susan Noonan of Noonan/Russo Communications, Inc., 212-979-9180, for Columbia Hospital and Basic American Medical/
 (CHOS BAMI) CO: Texas, Indiana ST: Texas, Indiana IN: HEA SU: TNM


TQ-HM -- NY019 -- 2978 04/27/92 09:19 EDT
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Publication:PR Newswire
Date:Apr 27, 1992
Words:667
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