A major shareholder in imaging center firm American Health Services has been placed in receivership. It is expected that 3.8 million shares of preferred AHS stock held by OmniCorp Holdings of Switzerland will be offered for sale. This amounts to about 28% of AHS equity. AHS hopes that an investor with experience in imaging services acquires the stock, said president E. Larry Atkins.
The financial problems of OmniCorp should not impact AHS operations or growth plans. It became apparent last year that the investment firm would not infuse additional capital into the firm. AHS, based in Newport Beach, CA, had also made the strategic decision to slow new center growth this year, Atkins said.
"Over the last few months, we had discounted them (OmniCorp) as a future source of investment. Assuming the block of stock they own will probably be sold, management would like to facilitate the transfer of stock into strong hands," he said.
OmniCorp is a large investment company with a portfolio valued in excess of $2 billion. AHS was OmniCorp's only U.S. health-care investment.
OmniCorp's $7 million equity investment a year and a half ago (SCAN 10/25/89) fueled a rapid expansion of AHS imaging centers. The company launched 18 centers over the last 14 months, nearly doubling its total network to 40 centers. Bringing so many start-ups on line at once, however, had a depressing effect on company profits (SCAN 12/12/90), Atkins said.
"We had a lot of brand-new centers starting out at five to six scans a day. We expect to add six centers in 1991, which is about a third of the growth rate we had last year," he said.
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Funds from the offering will be used to pay off debt and expand HI's network of 28 magnetic resonance imaging centers and one radiation oncology center. HI also manufactures MRI scanners, largely for use in its own centers, and provides third-party imaging equipment maintenance services.
The extraordinary gain involved relief of Elscint debt brought about by a financial restructuring of the company and an agreement with creditor banks completed in late 1989 (SCAN 11/22/89).
