P.M. BRIEFING : Health Care Firms to Merge
National Heritage Inc. of Dallas has agreed to merge with Life Care Centers of America Inc. of Cleveland, Tenn., to form a new company through a stock transaction in which Life Care will have a controlling interest.
The agreement followed an announcement Feb. 5 that the two large long-term health care management companies were discussing a merger. The new company will carry Life Care’s name and be headed by Life Care Chairman Forrest Preston.
In addition to the combined assets of National Heritage and LCCA, the new company will include selected assets and operations of certain affiliates of the two firms and certain health-care assets of Southmark Corp., headquartered in Dallas.
Southmark, once a $9-billion real estate-based financial company, is currently in Chapter 11 proceedings. It and its subsidiary, Pacific Standard Life Insurance Co. of Davis, Calif., together own about 62% of National Heritage.
Pacific Standard is in conservatorship after California insurance regulators ordered Pacific in December to stop selling insurance because of capital deficiency estimated at about $54 million.
