MetWest Closing Newport Beach Management Office

The largest operator of independent medical laboratories in Southern California, MetWest Inc., is closing its Newport Beach management office and transferring the operation to an affiliated company in New Jersey, MetWest officials said Tuesday.

MetWest, a subsidiary of Unilab Corp., is transferring its eight-employee Newport Beach administrative and financial staff to MetPath Inc. in Teterboro, N.J. MetPath owns a 20% stake in Unilab.

“The only thing being closed is the management and support services,” said John P. Grimaldi, a Unilab spokesman in New York. “We’re trying to consolidate that function into MetPath.”

Grimaldi said the reorganization is being undertaken as a cost-cutting move and because the Newport Beach office can be operated as efficiently from the East Coast. MetWest, which has 2,400 employees nationwide, was created in 1988 when it acquired labs in the western United States from MetPath.

As part of the reorganization, MetWest President David J. Bush has resigned and will be replaced by Richard A. Michaelson, a MetPath vice president.

“I was told they want to do things differently and the shareholders agreed to it,” Bush said.

Under Bush, MetWest launched an aggressive acquisition program and grew from $40 million to $140 million in annual sales in a little more than a year. The company spent $87 million to acquire two laboratories with operations in San Jose, Los Angeles and Arizona, bringing its total number of labs to about 50.

“Size is important (in the laboratory business), and these acquisitions took good operations and made them substantial in each of the cities we’re in,” Bush said.

MetWest is the sixth-largest independent laboratory in the nation and the biggest in Southern California. MetPath, which expects sales of about $400 million for the current year, is one of the nation’s four largest independent laboratories.

Independent medical laboratories generally are used by physicians as an alternative to hospital or in-house labs. The labs conduct clinical testing of human body fluid samples or tissues in the diagnosis, monitoring and treatment of disease.