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BASKING RIDGE, N.J., Aug. 31, 1999 -- Hooper Holmes, Inc.(Amex: HH) today announced that it has entered into a definitiveagreement to purchase the assets of Paramedical Services ofAmerica, Inc. (PSA), the Atlanta based paramedical examinationsubsidiary of Pediatric Services of America, Inc. (Nasdaq: PSAI). Theacquisition of PSA is in line with Hooper Holmes' strategy ofexpanding its existing capabilities of providing outsourced healthinformation services for the life and health insurance industries on anationwide basis. PSA services its premier customer base with over200 locations throughout the United States. In its fiscal year endedSeptember 30, 1998, PSA generated revenue of approximately $90million.
The purchase price is subject to certain adjustments and is expectedto be between $85 million and $95 million, which the Companyexpects to initially finance with existing cash and bank borrowings.The transaction is expected to close in late 1999, subject to certainregulatory approvals and other customary closing conditions. TheCompany expects the acquisition to be accretive to fiscal 2000earnings.
Commenting on the acquisition, Jim McNamee, Chairman and ChiefExecutive Officer of Hooper Holmes said, "We are excited to bringthese two companies together. From a strategic standpoint, thiscombination positions Hooper Holmes to better serve bothcompanies' customer bases through increased automation, improvedresponsiveness and more complete geographic coverage. At thesame time, it will also enhance our marketing and new customeropportunities, and create significant operating synergies."
A. G. Edwards and Sons, Inc. acted as Hooper Holmes' financialadvisor on this transaction.
Hooper Holmes, Inc. provides medical and other underwritinginformation on insurance policy applicants to the major companies inthe life and health insurance industry. The Company provides thesehealth information services through its 200 locations nationwide.
Certain information contained herein includes information that isforward-looking. The matters referred to in forward-looking statementsmay be affected by the risks and uncertainties involved in theCompany's business. These forward-looking statements are qualifiedin the entirety by cautionary statements contained in the Company'sSecurities and Exchange Commission filings.
SOURCE Hooper Holmes, Inc.
CONTACT: Fred Lash
Chief Financial Officer of Hooper Holmes,Inc.
908-766-5000
or
Ed Bisno, Jill Zames or Stacey Nield
Media of Morgen-Walke Associates
212-850-5600
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