14% of Admar Group Inc. Purchased by L.A. Firm
The Admar Group Inc., an Orange-based health care company, said TPA of America Inc. has paid $1.5 million for 14.3%--or 5.3 million shares--of its common stock.
Los Angeles-based TPA said it bought the shares for investment purposes only. TPA markets administrative services to employee benefit plans. The cash transaction appears to make TPA Admar’s largest outside shareholder, said Roger Lightholder, Admar’s vice president and general counsel.
Admar, which had revenue of $2.3 million for its fiscal 1987 third quarter ended Oct. 31, said the two companies also have agreed to a marketing arrangement under which TPA will be able to offer Med Network, a preferred-provider organization administered by Admar, to TPA’s clients. TPA reported 1985 revenue of $53 million.
Randall Huyser, a health care securities analyst, said Wednesday that the purchase was predictable because TPA “has been on an acquisition binge for the last year or so†and Admar can offer the company a preferred-provider network of physicians who have agreed to limit their charges to the ceilings imposed by health insurance companies.
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