PESCH UNIT SEEKS BALANCE OF REPUBLIC HEALTH

  Alpha Health Systems Corp, a
  wholly-owned subsidiary of Pesch and Co, said it submitted a
  merger proposal to the board of REPH Acquisition Co, the parent
  company of Republic Health Corp, which is 64 pct owned by Pesch
  interests.
      The balance of REPH's common stock is owned by members of
  Republic management, McDonnell Douglas Corp &lt;MD>, Donaldson,
  Lufkin and Jenrette and Pacific Asset Holdings L.P.
      Republic currently owns 44 hospitals and manages 46 other
  facilities, in 25 states.
      Details of the proposal were not disclosed.  Company
  representatives were not immediately available.
      The proposal provides that REPH would become a wholly-owned
  subsidiary of Alpha and that the existing REPH common
  stockholders would become stockholders of Alpha, it said.
      REPH's board has appointed a special committee to negotiate
  terms of the proposed merger, Pesch said.
      Last year, Republic was acquired by REPH in a leveraged
  buyout transaction led by Dr. LeRoy Pesch, the principal
  shareholder of Pesch and Co.
      Alpha recently submitted a second offer to acquire the
  stock of American Medical International Inc (AMI) at 22 dlrs a
  share in cash and securities, which is still being considered
  by American Medical's board, Pesch said.
  

