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Strategies & Market Trends : Crescent Real Estate Eq (CEI) -- Ignore unavailable to you. Want to Upgrade?

To: rainwater who wrote (21)	3/10/1998 1:42:00 PM
From: rainwater	Read Replies (1) \| Respond to of 27

Will COPI break even? The +$78 mill due to the new arrangement will be negated by additional debt to an already high existing debt. However would the new COPI deserve P/E ~40 comparable to MGL P/E = 80? _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ excerpts: Crescent Operating said that under the agreement, the $78 million annual franchise fee payable by Charter to Magellan will be eliminated. The Wall Street Journal reported last year that the franchise fee was one of the factors that prevented the joint venture that operated the hospitals from being profitable. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * COPI versus MGL COPI MGL Mkt Cap: 248 mill 683 mill outs share 11 mill 30 mill 5 yr growth 0% 700% earn/rev -1.03 0.02 p/e n/a 84 96' Rev 10.3 mill 1345 mill 96' Incom -10.8 mill 32 mill * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Total sale $310 mill includes: Charter Advantage LLC - Magellan's franchise of mental hospitals + interest in 6 hospital based joint ventures (at $280 mill) + its 50% interest in Charter Behavioral ($30 mill in COPI stock) Charter Behavioral Health Systems provides behavioral and addiction treatment programs.