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HORIZON HEALTHCARE CORPORATION TO ACQUIRE GREENERY REHABILITATION GROUP INC. IN STOCK FOR STOCK MERGER

 ALBUQUERQUE, N.M. and NEWTON, Mass., Aug. 2 /PRNewswire/ -- Horizon Healthcare Corporation (NYSE: HHC) and Greenery Rehabilitation Group, Inc. (NYSE: GRG) today jointly announced that they have entered into an agreement pursuant to which HHC will acquire GRG in a merger by an exchange of one share of HHC newly issued stock for every four shares of GRG outstanding stock. After the merger, outstanding issues of Greenery's convertible subordinated debentures of approximately $26.6 million of 6.50 percent bonds due in 2011 and $28.1 million of 8.75 percent bonds due in 2015 will become obligations of HHC on a price adjusted basis according to the terms of the bond indentures which will not be dilutive. There are approximately 8.2 million shares of GRG presently outstanding and approximately 11.3 million shares of HHC presently outstanding.
 At March 31, 1993, GRG operated 20 rehabilitation facilities which specialize in rehabilitation of traumatic brain injured and other subacute special service patients and long term care centers. GRG's annualized net patient care revenue based on the quarter ended March 31, 1993 were approximately $189.6 million. HHC, headquartered in Albuquerque, is a leading provider of specialty healthcare services, including licensed specialty hospitals and subacute units, institutional pharmacy services, rehabilitation therapies, clinical laboratory, Alheizemer's care and long-term care nursing. HHC's annualized operating revenues based on the quarter ended May 31, 1993 were approximately $290 million.
 The proposed transaction is conditioned upon HHC's completion of a public or private financing to raise proceeds of approximately $80 million which will be used to retire debt and purchase a $60 million partnership interest in properties owned by Health and Rehabilitation Properties Trust (NYSE: HRP) which properties are now leased to GRG. Purchase of the partnership interest will reduce annual rentals by approximately $7.5 million.
 Commenting on the merger, Horizon Chairman and CEO Neal Elliott noted, "We are very excited about the merger with Greenery. By combining Greenery and Horizon's licensed specialty hospital and subacute programs, we will create the country's largest network of facilities and programs to serve the needs of medically complex cases. We believe that with the rapid expansion of managed care programs as the primary payor for healthcare services, Horizon's facilities will be ideally positioned to provide managed care providers nationwide services as a cost effective alternative to the acute care setting. Greenery, a pioneer in the development of treatment protocols for brain injury and rehabilitation, will strongly complement Horizon's rapidly growing licensed specialty hospitals and subacute care programs. At the completion of this transaction, more than 40 percent of Horizon's total revenues will be generated from such specialty programs."
 Mr. Elliott continued, "Significant savings and economics of scale will result from the rapidly consolidation of the administrative and marketing operations of the two companies. We are confident that the transaction and any required financing will have a positive immediate impact on combined earnings."
 "In addition, tremendous new opportunities are created for the expansion of Horizon's institutional pharmacy, rehabilitation, laboratory and other specialty programs in all 20 of Greenery's facilities. As I've previously stated, the acquisition program for our core long-term care business is the impetus for growth in earnings in our specialty programs. Greenery's long-term care business segment fits into our proven formula for success."
 Commenting on the proposed merger, Gerard M. Martin, chairman and CEO of GRG, made the following statement: "In the past, the relatively small size of Greenery's operations has meant that minor variations in patient census or payor mix have had a dramatic impact upon reported financial results. Also, Greenery's attempt to manage single locations in different regions has proved to be inefficient in the increasingly competitive marketplace for subacute specialized health services. When Greenery is combined with Horizon, I believe the full potential of our first class facilities and excellent professional staff will be realized."
 The proposed merger is conditioned upon the approval by the shareholders of GRG and by various health regulatory agencies. Mr. Martin and the members of his family who control approximately 51 percent of the outstanding shares of GRG have indicated their intention to vote in favor of the merger. The merger is expected to be complete during the fourth quarter of calendar 1993.
 Horizon Healthcare Corporation, headquartered in Albuquerque, N.M., is a leading provider of quality specialty healthcare services including licensed specialty hospitals and subacute units, laboratory services, rehabilitative therapies, pharmacy services, Alzheimer's care and long- term nursing care. Through National Institutional Pharmacy Services, Inc., CRC Rehabilitation Centers, Inc. and LTC Medical Laboratories, Inc., Horizon provides institutional pharmacy services, rehabilitation therapies and clinical laboratory services. As of Aug. 2, 1993, Horizon operates four specialty hospitals and four subacute units, 81 nursing centers with a total of 8,962 beds in 11 states, and institutional pharmacy services serving more than 22,000 beds.
 -0- 8/2/93
 /CONTACT: Michael Seeliger of Horizon Healthcare, 505-881-4961/
 (HHC GRG)


CO: Horizon Healthcare Corporation; Greenery Rehabilitation Group ST: New Mexico; Massachusetts IN: HEA SU: TNM

LG-TS -- NY012 -- 8178 08/02/93 08:41 EDT
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Publication:PR Newswire
Date:Aug 2, 1993
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