The board of New York City Health and Hospitals Corp. last week voted to select five senior managers and 12 co-managers for an underwriting syndicate.

The five senior managers are Artemis Capital Group, a women-owned firm; Dillon, Read & Co.; Grigsby Brandford Powell Inc., a minority owned firm; J.P. Morgan Securities Inc.; and Paine Webber Inc.

The co-managers are Donaldson, Lufkin & Jenrette Securities Corp.; Fleet/Norstar Securities Inc.; Innova Securities Inc., a minority-owned firm; Kidder, Peabody & Co.; Lazard, Freres & Co.; Lehman Brothers Inc.; MDH Holdings Inc., a minority-owned firm; Morgan Stanley & Co.; Prudential Securities Inc.; Pryor, McClendon Counts & Co., a minority-owned firm; Samuel A. Ramirez & Co., a minority-owned firm; and WR Lazard, laidlaw & Mead Inc., also a minority-owned firm.

One interesting twist to the selection process was that Michael D. Hernandez, the founder, chairman, and managing partner of MDH Holdings, had been a senior vice president with Donaldson Lufkin until a week before the authority sent out its request for proposals for the bond syndicate on Aug. 13.

Mr. Hernandez, who recently changed the name of Hernandez & Co. to MDH Holdings, had signed a severance package with Donaldson Lufkin on Aug. 7, a source at the firm said. The agreement, which expires on Dec. 31 of this year, allowed him to use a desk and a phone in the firm's offices.

The firm was aware that Mr. Hernandez had his own firm and was seeking a slot in the syndicate, a spokeswoman for Donaldson Lufkin said on Friday. "They were aware, he had checked, and there was no problem with that," she said.

Mr. Hernandez could not be reached for comment.

In early 1988, Mr. Hernandez left First Boston Corp. when the investment bank's public finance office was riding high. More than a year later, Mr. Hernandez showed up at Donaldson Lufkin as senior vice president of a new health-care and education department.

In the interim, he established Hernandez & Co. which specialized in health-care finance. The firm remained in existence throughout Mr. Hernandez's tenure at Donaldson; before he joined the company, Mr. Hernandez and Donaldson concluded a "no-compete" agreement.

Steven Matthews, a spokesman for the hospitals corporation, said, "As far as we understand or know, there is no connection between DLJ and MDH Holdings."

As for the bond syndicate, Mr. Matthews said all the firms are appointed for two-years terms.

The corporation's board viewed proposals from 31 firms, he said. A selection committee was made up of officials from the corporation, the city Comptroller, the city's Office of Management and Budget, and the Department of Economic development.

As for the selection of so many minority-and women-owned firms, Mr. Matthews said, "It has long been the policy of the corporation to provide opportunities for minorities and women, both in our work force to make it culturally sensitive to the patients we serve and in our contracting practices."

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