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PROVIDENCE HEALTH CARE SHAREHOLDERS RETAIN CURRENT BOARD

    BEREA, Ohio, Sept. 15 /PRNewswire/ -- Providence Health Care, Inc. (NASDAQ: PHCI) announced today that shareholders representing more than 50 percent of the Company's 4.6 million currently outstanding common shares tendered written consents to Providence in support of the retention of the current board of directors.
    On Aug. 30, Commonwealth Associates, a New York City investment bank that served as managing underwriter for Providence's February 1992 initial public offering, first disclosed that it would seek to oust Providence's board.  In Commonwealth's 13D filing with the SEC and in its preliminary consent solicitation materials, Commonwealth said it intended to attempt to install a new slate comprised of two Commonwealth officers and two other individuals of its choosing, by soliciting consents from shareholders owning 50 percent of Providence's 3.7 million outstanding shares as of Aug. 27, 1993.
    Lawrence Cummings, Providence's chief executive officer, said, "We believe the vast majority of Providence shareholders will be gratified to know that the Company's current board and management will remain in place to bring the Company's business plan to fruition.  Clearly, Commonwealth's efforts to replace our management will not result in a change of control."
    Mr. Cummings added that he submitted to the Company consents representing his shares, together with consents from several other large Providence shareholders.
    Jugal K. Taneja, a newly appointed Providence director, who is also chairman and chief executive officer of NuMED Home Health Care, Inc., which owns 20 percent of Providence, stated, "As one of Providence's largest shareholders, NuMED is vitally interested in good management and the future growth of Providence.  The current composition of Providence's board has NuMED's full support.  We are familiar with the controversy regarding Commonwealth's efforts to replace the board, but we do not share Commonwealth's view."
    NuMED joined Mr. Cummings in submitting a written consent to the Company in support of the current board.  The Providence board consists of Messrs. Cummings and Taneja as well as Harvey Wershable, Brian A. Lingard and Thomas W. Janes.
    In a transaction announced Monday, Sept. 13, NuMED sold 40 percent of its common stock to Providence in exchange for 20 percent of Providence common stock plus $375,000 cash.  Providence and NuMED had been in discussions concerning a transaction between them since March 1993.
    Providence Health Care, Inc. was formed in February 1989 and acquired Northwestern Service Corporation, a nursing home operator, in June 1989.  The Company operates 15 long-term care facilities, 13 in Ohio and one each in Vermont and Virginia, with an aggregate 1,245 beds. Of these, 1,184 are nursing care beds and 61 are assisted-living beds. In addition, the Company manages a 175 bed facility in Cleveland. Through Northwestern, which was merged into Providence in December 1992, the Company has been engaged in the nursing home business since 1970 and since 1983 has grown significantly through selected acquisitions and internal development.  All of the Company's Ohio facilities are located within approximately 150 miles of the Company's headquarters in Berea, Ohio, a Cleveland suburb.
    -0-             09/15/93
    CONTACT:  Stanley J. Kay of MacKenzie Partners, Inc., 212-929-5940
    (PHCI) CO:  PROVIDENCE HEALTH CARE, INC.; COMMONWEALTH ASSOCIATES IN:  HEA ST:  OH,NY


-- NY101 -- X269 09/15/93
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Publication:PR Newswire
Date:Sep 15, 1993
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