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ElderCare Takes Majority Stake in Ranworth Health

ElderCare Takes Majority Stake in Ranworth Healthcare
Enhances Fee Based Earnings Stream

Auckland – 10 May 2000 – Listed retirement care provider ElderCare New Zealand (NZSE: ELD) today announced that it has signed a conditional agreement to acquire a 67 percent interest in Ranworth Healthcare Limited, New Zealand’s largest brain injury assessment and rehabilitation service provider.

The deal is worth approximately $4.0 million and will be settled by $2.8 million in cash and three convertible notes totaling approximately $1.2 million. Settlement is expected on the 25th May 2000.

ElderCare New Zealand Chief Executive Officer, Alan Clarke, says the acquisition fits with ElderCare’s strategy of acquiring care based operations with good track records in sound locations with expansion opportunities. “With 18 residential facilities operating in nine major regions throughout New Zealand, Ranworth is the largest service provider of its type for people suffering from brain injuries. As well as having scale, its multi disciplinary team of experienced health professionals has established a reputation for leadership in the assessment and rehabilitation of people who have experienced a brain injury. This leadership is evidenced by the large number of clients who are referred to Ranworth by ACC.”

Ranworth Healthcare currently employs 171 staff who provide assessment and rehabilitative services for 136 residential clients, 53 community clients and 17 residential and community based vocational clients. It provides a residential rehabilitation environment for those with moderate to severe brain injuries in Whangarei, Auckland, Hamilton, Gisborne, Hastings, Wanganui, Palmerston North, Christchurch and Dunedin.

In December 1999 the company won the first ever four year ACC contract for Post Acute Residential Rehabilitation Support for Seriously Injured (PARRSI) as well as a two year vocational contract. The company also works with the Health Funding Authority.

Ranworth General Manager, Andrew Beattie says ElderCare’s investment in the company will enhance its ability to deliver its services to a greater number of clients. “There are an increasing number of people in New Zealand who have suffered brain injury and are not adequately treated. In fact they are often inappropriately placed in psychiatric boarding houses, rest homes, handed back to their families with little support, or left to their own devices in the wider community. It is within this context that Ranworth, like ElderCare, is experiencing significant demand from an increasing number of people who require residential based care and rehabilitation services.”

Of the 30,000 New Zealanders who received a head injury last year, 6,000 suffered brain injuries.

Beattie says Ranworth and ElderCare also share fundamental similarities in care philosophy. “Our assessment and rehabilitative services are driven by a philosophy similar to ElderCare’s Continuum of Care. Both companies provide a residential care environment where clients feel relaxed and comfortable, allowing them to pursue a lifestyle that will give them the greatest possible independence leading to solutions they and their families devise together.”

Going forward, Clarke says ElderCare will work with Ranworth senior management to develop infrastructure initiatives that will improve day-to-day operational synergies between the two companies as well as enhance the ability of Ranworth’s clinical staff to meet the assessment and rehabilitation needs of clients.

About Ranworth Healthcare Limited

Ranworth Healthcare Limited is a specialist residential assessment and rehabilitation service provider for people who have suffered a brain injury. The company has 18 facilities throughout New Zealand making it the largest service provider of its type in the country. These facilities are based in Whangarei, Auckland, Hamilton, Gisborne, Hastings, Wanganui, Palmerston North, Christchurch and Dunedin.

About ElderCare New Zealand Limited

ElderCare New Zealand Limited (NZSE: ELD) is a retirement care provider. The company owns a substantial portfolio of nursing homes and assisted living facilities throughout New Zealand at which they offer broad and varied services for the health and residential care needs of elderly people.

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