GRANCARE INC
8-K, 1997-01-10
SKILLED NURSING CARE FACILITIES
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<PAGE>
 
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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    Form 8-K

               CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                            THE SECURITIES ACT 1934



                Date of Report (Date of Earliest Event Reported)
                                January 8, 1997


                                 GRANCARE, INC.
             (Exact name of registrant as specified in its charter)



 
CALIFORNIA                      001-12100                    95-4299210
(STATE OR OTHER                 (COMMISSION                  (I.R.S. EMPLOYER
JURISDICTION OF                 FILE NUMBER)                 IDENTIFICATION NO.)
INCORPORATION)


                         ONE RAVINIA DRIVE, SUITE 1500
                                ATLANTA, GEORGIA
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                     30346
                                   (ZIP CODE)



       Registrant's telephone number including area code: (770) 393-0199
================================================================================
<PAGE>
 
Item 5.  Other Events

     On January 9, 1997, the Company issued a press release regarding the
effectiveness of the registration statements with respect to the stock to be
issued in the pending merger with Vitalink Pharmacy Services, Inc. and
projecting earnings per share numbers for the Company's fourth quarter.
Attached as Exhibit 99.1 is a copy of that press release.



                                       2
<PAGE>
 
                                   SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.

                                 GRANCARE, INC.


                                 By: /s/ Evrett W. Benton
                                     --------------------------------------
                                     Evrett W. Benton
                                     Executive Vice President, General Counsel &
                                     Secretary


Dated:  January 10, 1997



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<PAGE>
 
                                 EXHIBIT INDEX

                                                                  Sequential
Exhibit No.                                                        Page No.
- -----------                                                        --------

99.1    GranCare, Inc. Press Release dated January 9, 1997,
        announcing the effectiveness of registration statements
        and projecting fourth quarter earnings.

<PAGE>
 
                        GranCare Announces Effectiveness
                   of Registration Statements and Anticipated
                            Fourth Quarter Earnings


     Atlanta, Georgia - January 9, 1997 - GranCare, Inc. (NYSE:  GC) announced
today that the Securities and Exchange Commission (SEC) has declared effective
the registration statement relating to the shares of Vitalink Pharmacy Services,
Inc. (NASDAQ: VTLK) to be issued in connection with the acquisition by Vitalink
of GranCare's institutional pharmacy business (the "merger"), which includes a
proxy statement to be mailed to GranCare's shareholders.  In addition, the SEC
has declared effective the registration statement with respect to the shares of
common stock of "New GranCare, Inc." to be distributed to existing GranCare
shareholders (the "distribution").  Immediately following the distribution and
merger, "New GranCare, Inc." will change its name to "GranCare, Inc.".

     Each GranCare shareholder as of the distribution record date will be
entitled to receive, for each GranCare share, one share of "New GranCare" common
stock and 0.478 of a share of Vitalink common stock.  "New GranCare, Inc."
anticipates that its common stock will be listed on the New York Stock Exchange
and trade under the symbol "GC".  GranCare has postponed its decision to execute
a 2-for-3 reverse stock split which was previously announced to have occurred
simultaneously with the completion of the distribution.

     A Special Meeting of Shareholders of GranCare, Inc. will be held on
February 8, 1997 to consider and vote on the distribution and merger.

                                     (more)
<PAGE>
 
PAGE TWO

     Based on preliminary information, the Company announced that it expects to
report profits from operations of approximately $0.33- $0.35 per share for the
quarter ended December 31, 1996;  GranCare earned $0.31 per share in the
comparable quarter in 1995.  For the year ended December 31, 1996, net earnings
for 1996 are expected to be in the range of $1.33-$1.35 per share, compared to
net earnings of $0.86 per share in 1995, which includes costs associated with
restructuring and the merger with Evergreen.

     Gene E.  Burleson, GranCare's Chairman, President and Chief Executive
Officer, stated, "Our fourth quarter 1996 results were impacted primarily by
unchanged average occupancy at our nursing facilities which had been projected
to increase by approximately two percent during the year, and by decreased
Medicaid reimbursement rates in certain states.  In addition, our Indiana
operations have continued to be adversely affected by the foregoing factors, as
well as our inability to find an acceptable solution to the Ritter facility
which, as previously announced, was closed in the fourth quarter of 1995."

     Except for historical information contained herein, this press release
contains forward-looking statements that involve risks and uncertainties that
could cause results to differ materially from those projected.  These include
trends for the continued growth of the Company's business, and other risks and
uncertainties described in the Company's SEC reports and the registration
statement of "New GranCare" referenced above.

     GranCare, Inc., headquartered in Atlanta, is a leading provider of
specialty medical services and long-term care.  The company operates 140 skilled
nursing, assisted living and subacute facilities with over 17,500 beds in 15
states; 25 institutional pharmacy locations and 8 satellite locations serving
120,000 customers in 23 states; 12 home health agencies in 4 states; and,
through its Cornerstone subsidiary, manages 145 specialty programs in acute care
hospitals in 20 states.  


GranCare's press releases are now available via fax through PR Newswire's 'News
   on Call' service.  Just dial the toll-free number, 800-758-5804 and follow
                    directions.  Our company code is 102695.

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