William, now that the news about the Franklin Group's 5.5% ownership of OXHP is out, people will have a chance to assess. In the DD process they will also look at the other health care organiztions that Franklin has a stake in, including but not limited to Pacificare (~10% of company), Foundation Health (8.2%), Maxicare (10%), Mid-Atlantic (% unknown to me). To my best knowledge, the other organizations are not plagued by the big mess that Oxford is experiencing such as:
- Oxford currently has no CEO
- Oxford currently has no CFO
- OXHP expects to post a loss of ~$1.45/share for the Q ending 12/97
- Malfunctional computer systems
- NY County Medical Society's legal claims for $140 million owed to its 5000 members
- Supoena by NY State Attorney General related to Oxford's own report of $145 million backlog of overdue payment to doctors and hospitals statewide
- Several class action law suits alleging the company in violation of federal securities laws
- Oxford's failure to bill its clients
A week ago, OXHP stock spiked due to the Aetna buyout rumor only to quickly gave back most of the gains. I bet that it will retreat again in a couple of trading sessions. People may opt for Pacificare, Foundation Health, Maxicare, Mid-Atlantic which the Franklin Group owns more of those companies, percentage wise, than its stake in Oxford.
This is just MHO. We'll see.
Regards,
Tom |
