When American Health Services, Inc., a D.C.-based owner-operator of hospitals, announced its intent to "go private" in March, it was a quiet move that most observers at the time believed made sense for a small company.
But some shareholders are unhappy because of what they feel is a lack of communication from the company and dissatisfaction with the proposed buy-out package.
The plan, which was filed June 21 with the Securities and Exchange Commission for approval of the proxy material, proposes a cash payment per share of $1 plus a $10.80 subordinated unsecured debenture with a 12 percent coupon maturing in 10 years to each public stockholder.
About 62 percent of the controlling interest in American is held by three private companies. And of those, Melvyn Estrin, president; Dr. Hyman Frankel, vice president; Charles Abod, treasurer; and Dr. Sheldon Steinberg, director of American, own 90 percent of the stock.
The board approved the proposal to go private June 7 and expects approval from the SEC this month - with a stockholders meeting probably held in August.
Meanwhile, some stockholders have complained in interviews they have been kept in the dark concerning American's proposal and correspondence to the company frequently has been unanswered.
Some investors have yet to receive a copy of the 1978 annual report and accounts of the plan to form a private company held by the current major stockholders were read in newpaper or passed along by word of mouth.
According to Abod, the company has been waiting to get its proxy material in order before formally notifying shareholders. In any case, he said, since the proposal was announced response from public holders so far "is nothing significant."
Thompson McKinnon Securities was asked for an evaluation of the offer and, according to Alan Arsht, associate director for corporate finance, "We believe the consideration is fair to stockholders."
One shareholder, who asked not to be identified, speculated the company might be offering a low package in anticipation of a larger per share offer to buy American from another concern.
However, Anthony G. Polak, a stockholder and president of Equity Interest Inc., New York, sees nothing unusual about the firm's actions. "It doesn't pay for them to be public unless they want to float more stock," he said.
Still, like most shareholders, he believes the offer is too low and should be placed about $20 a share.
Similarly, Lawrence J. Goldstein, securities analyst at Drexel Burnham Lambert in New York sees the offer as "inadequate" and proposes a $30 offer. "The company could liquidate for more than the package they offer," he charges.
Company sources said the move was intended to help get financing. But Goldstein observed: "I don't see why the company needs financing. But if they did, they should not have any problem. This is a strong company and strong in relation to other companies in the industry."
American reported assets of $5.7 million, with $8.3 million in real estate and equipment, in the 1978 annual report. The company listed long-term debt as $3.5 million and had retained earnings of $4 million.
Yesterday, the stock was offered on the over-the-counter market at $10 bid.
According to the annual report, the firm sold assets in three nursing homes last October for a pre-tax gain on sales of about $3.4 million. American also has cash and equivalents equal to 82 percent of equity.
For the year, the company reported net income of $1.3 million ($1.50 a share) on operating revenues of $24.2 million compared with income of $853.953 ( $1 a share) on revenues of $22.4 in 1977.
For the six months ended March 31, American reported income of $2.7 million ($3.23 a share) and revenues of $10.5 million compared with income of $422,000 (50 cents a share) on revenues of $12.3 in 1978.
The SEC, meanwhile, is expected to vote on Thursday on proposed rule changes involving firms that seek to change from a public status to private ownership. In 1977, the agency proposed regulations to set standards for measuring the "fairness" to minority owners when stock is bought up. Reportedly, the SEC staff now is urging that the agency stay clear of assessing the fairness question in final regulations and simply require directors to state whether they believe plans to go private are fair to minority owners.
NEW LABS: Biospherics Inc., a Rockville environmental product and research company, has launched a major expansion of its laboratory services.
President Gilbert Levin said a new facility for aquatic toxicology testing will be capable of probing for industrial clients, many of the 130,000 chemicals, pesticides and pharmaceutical products now in the market or under regulatory review.
DOORS CLOSED: Suppliers and customers of Washington's only housewares wholesaler, Pelzman & Grob, said they are wondering what has happened to the Springfield-based firm.
A spokesman for Rubbermaid Inc., which manufactures goods that were a major product line of the area firm, said Pelzman & Grob "just went out of business."
Roy Morris, an attorney for the company, said that after consulting with his firm's partners, "We're going to decline to comment at this time." When asked why he would not comment, Morris replied, "We're going to decline to comment."
A woman answering at the residence of the firm's president, John Grob, said that the company was liquidating, but she would not allow a reporter to speak to Grob. She reffered all questions to Morris.
The Springfield firm "had been a significant distributor for us," said a General Housewares Corp. spokesman. "They've done an excellent job at department stores."
The Zamoiski Co., a distributor and wholesaler in Baltimore, now has many of the accounts that Pelzman & Grob once had, according to the company vice president, John McCaffery. "We're filling the service to those customers that Pelzman & Grob used to have," McCaffery said.
McCaffery added, though, that he was unsure of Pelzman & Grob's financial status.