Center firm consolidates structure

Diagnostic Imaging Services of America changed its name and consolidatedits corporate structure in July. The Kirkland, WA, imaging centercompany is now called Olympic Imaging Services.

Separate subsidiaries that served as center general partnershave been consolidated into the parent company, which is generalpartner for all Olympic centers, said Jan L. Arps, executive vicepresident and CFO.

The simplified structure should improve operational efficienciesand access to capital, he said.

"It is easier when all personnel work for one company.You can move them around to different centers as needs arise,"Arps said. "The simplification also makes it easier for usto deal with bankers and lending institutions. There was a lotof confusion about our corporate structure."

Olympic Imaging Services was the name of a subsidiary companythat provided management support services for the firm's centers,he said.

The imaging center company is general partner and providesmanagement services to three MRI and CT imaging centers:

• Rainer Medical Imaging Center in Kirkland;
  
• Medical Imaging Services in Eureka, CA; and
  
• TIS Imaging Center West in El Paso, TX.

Improved access to lenders should help Olympic meet its objectiveof opening two centers in 1992 and three a year for the followingthree years.

"At this point, we are capital-limited and are lookingfor additional capital. If equity capital is there, we will expandmore rapidly," Arps said.

Olympic is attempting to arrange a private placement of stockwith institutional or large individual investors, he said. Eventually,the firm may consider a public offering.

"The timing is premature for our company. We have to furtherstrengthen our balance sheet. But we are looking at the potentialof a public offering and talking to brokerage firms in that regard,"Arps said. "We are also looking to get away from the limitedpartnership approach and have them (company centers) internallyfinanced."

Olympic believes it lies well within the Department of Healthand Human Services Safe Harbor rules on referring physician ownershipof medical joint ventures.

The imaging center firm has many non-physician investors involvedin its partnerships, and physicians in a position to refer makeup less than 40% of center ownership, he said.

"It (the safe harbors) has accelerated our plans to acquireother centers that are in violation of the safe harbors,"Arps said.