Merger Talk Raises Stock of Regency : Health services: The Tustin company combined with the larger Care Enterprises only last April. Wall Street prices rise 9%.

Regency Health Services Inc., which only last April merged with the larger Care Enterprises, said Friday that it is considering a “possible business combination” with another company. Wall Street responded by pushing its stock up 9%.

Regency cautioned that no agreement or understanding has been reached yet, and the Tustin-based company would not predict whether the parties will reach an agreement.

Regency would not identify the company with which it is negotiating. Investors, though, didn’t seem concerned about that. The health care firm’s stock gained $1.25 a share to close at $15.25 in New York Stock Exchange trading.

The stock price had taken a tumble last summer when Regency announced that its earnings for the rest of the year would be lower than expected. Wall Street sold the stock at such a furious pace that Regency executives had to issue buyback pledges to halt the run. In one day of trading, the stock fell as low as $7.625 a share before ending the day at $8.25.

Since then, the stock price has been rising slowly.

Regency, which operates 94 specialty health-care facilities in California, Ohio, New Mexico and West Virginia, lost nearly $4 million for the first nine months last year.

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Regency Rebounds

Regency Health Service Inc., a Tustin-based company that operates health-care facilities in four states, said it is considering new business combinations. The announcement boosted the company’s stock price, which had fallen last year before leveling off in August. Monthly average price per share:

Feb. 3 close: $15.25

Source: Bloomberg Business News; Researched by VALERIE WILLIAMS-SANCHEZ / Los Angeles Times