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QUAL-MED OFFERS $100 MILLION TO ACQUIRE HEALTH NET STOCK

 QUAL-MED OFFERS $100 MILLION TO ACQUIRE HEALTH NET STOCK
 PUEBLO, Colo., Feb. 25 /PRNewswire/ -- Qual-Med Inc. (NASDAQ: QLMD)


announced today that it had sent a written offer of $100 million, cash, to HN Management Holdings Inc., the holding company for Health Net, the Woodland Hills, Calif. health maintenance organization, to acquire 100 percent of all outstanding Health Net stock.
 The offer, subject to due diligence, execution of a mutually satisfactory definitive agreement and approval of the definitive agreement by the board of Qual-Med and regulatory authorities, indicates that Qual-Med is prepared to increase the $100 million offer price if Health Net's 1991 pre-tax earnings substantially exceeded the projected 1991 pre-tax earnings of $36.4 million.
 Approximately two weeks ago, in connection with the conversion of Health Net from a not-for-profit to a for-profit company, HN Management Holdings Inc. paid $1.5 million for all the Health Net stock. Also, the management of Health Net paid $1.5 million for 20 percent of the HN Management Holdings equity (which represented 100 percent of the voting stock), and the California Wellness Foundation paid $7,640 for the remaining 80 percent of the equity (which represented 100 percent of the non-voting stock).
 "It continues to be our opinion that Health Net stock is worth a great deal more than the value indicated by the $1.5 million paid for Health Net's stock by HN Management Holdings. That is why we are prepared to offer at least $100 million," said Dr. Malik Hasan, president and chief executive officer of Qual-Med.
 A few hours after sending the $100 million offer to HN Management Holdings, Qual-Med learned that Health Net management was contemplating an initial public offering by the sale of common stock to the public.
 "Obviously, this was in the planning stage when the conversion application was still pending before the DOC, and any proceeds should be for the public's account and not enure to the benefit of the Health Net management," said Hasan.
 Qual-Med announced that it has successfully petitioned the Superior Court of California to prevent Health Net from "selling any of Health Net stock without approval from the Court." This order is in effect until March 12, 1992.
 Qual-Med, Inc., headquartered in Pueblo, provides comprehensive health care services to members (approximately 224,000 at Sept. 30, 1991) in California, Colorado, Idaho, New Mexico, Oregon and Washington. Its members pay a fixed monthly premium for services rendered and choose among a broad network of independent primary care physician.
 -0- 2/25/92
 /CONTACT: Dr. Malik Hasan, president, chairman and CEO, 719-542-0500 or J. Kevin Murphy, vice chairman, 913-234-9881/
 (QLMD) CO: Qual-Med Inc. ST: Colorado IN: HEA MTC SU:


EH-AL -- LA013 -- 2184 02/25/92 08:32 EST
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Publication:PR Newswire
Date:Feb 25, 1992
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