FOR THE RECORD: August 15, 1996 CORRECTION: The prospectuses and proxy statements regarding the acquisition of Wismer Martin Co. by Physicians Computer Network inc. were mailed to Wismer Martin shareholders on Wednesday. A story on the Tuesday business page incorrectly stated when they were mailed.
Shareholders of Wismer Martin Inc. will vote on the company’s proposed merger with Physician Computer Network at a meeting on Sept. 9.
Proxy statements for the vote were mailed to shareholders Monday.
Approval of the deal requires agreement by the holders of two-thirds of the company’s stock, but the vote is considered a formality as Wismer Martin’s largest shareholders are anxious to see the deal close.
Ron Holden, Wismer Martin’s chairman and chief executive officer, controls almost half of Wismer Martin’s stock. He and a handful of other large shareholders can deliver almost the two-thirds PCN needs.
But the objection of smaller shareholders is unlikely because it is doubtful that Wismer Martin can survive without the completion of the merger.
“In spite of the good products Wismer Martin had, lets face it, it’s had some real problems over the past two years,” Henry Green, PCN’s CEO, said in an interview in June. “But that’s not untypical of many organizations trying to compete in the consolidating and nationalizing trends of recent years.”
Under terms of the agreement, Wismer Martin shareholders will receive almost $2 million in cash and 935,000 shares of PCN’s common stock, valued between $10 and $12.25 a share.
Based in Morris Plains, N.J., PCN was, like Wismer Martin, a small company that sold computer software to the medical industry, until Green engineered a rapid expansion-through-acquisition program a couple of years ago.
Now it is one of biggest players in the field.
Wismer Martin was founded in 1980 by Glen and Judy Martin who had developed a software system for computerizing physician practices.
Outside investors bought into the company a few years ago, and through a series of events, Detroit investor Holden gained control of a majority of Wismer Martin stock. But following the acquisition of another Holden company, Integrated Health Systems, Wismer Martin’s fortunes turned sour.
It lost large amounts of money; its auditors quit in an accounting dispute; the bank holding its line of credit bailed out; the company lost its single biggest customer in the fallout from a legal dispute, and it failed in its efforts to make its mark in the emerging area of health-care information network software.
During that same time period, PCN has been a star performer in the medical software field. The company lost $44 million in 1991, but after Green took over management in 1993, the company has been robust. Forbes Magazine said the company should gross about $100 million this year.
Historically, PCN has acquired companies like Wismer Martin primarily for the physician customer base. The acquired companies have been downsized significantly in their local communities.
PCN officials say no decisions have yet been made on what will happen to Wismer Martin’s employees and operations in Spokane.
The Sept. 9 special shareholders meeting will be held at 9 a.m. at Wismer Martin’s headquarters located at 12828 N. Newport Highway.
Shareholders of record at the close of business on Aug. 1 will be entitled to participate.