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Crescent Capital Partners To Waive 90% Condition

Crescent Capital Partners To Waive 90% Condition

Auckland, NZ (February 26, 2008): Crescent Capital Partners (Crescent) today announced that it will waive the 90% condition in its takeover offer for Abano Healthcare Ltd should it receive acceptances taking it over 50%.

“Our decision to waive the 90% condition is in response to the decision by Healthcare Industries to acquire a 19.9% stake. This has effectively prevented us from our original intention of acquiring 100% of the shares in Abano,” said Michael Alscher, Executive Director of Crescent. “We have therefore revised our position and will be seeking a minimum 50.01 % stake in Abano.

“We will not be increasing the offer price. Also, we will not be extending the offer period further unless we get over 50.01% by March 14. This is it.

“We are a strategic player in the healthcare sector and we are committed to having a substantial presence in the New Zealand audiology market. Our preference is to buy Abano, but it is not the only option we have.”

Mr Alscher said that shareholders should be aware that if the Crescent offer for a minimum of 50.01% is unsuccessful, then the share price is likely to drop back toward pre-takeover speculation levels.

Crescent announced earlier in the month that it had extended the closing date of the offer to 5.00pm on Friday 14, March 2008. The offer can not be extended further under the Takeovers Code unless Crescent has secured over 50% by that time (having waived its 90% condition).

“Shareholders now have just under three weeks to decide whether they would like to accept into our offer and we encourage them to take advantage of the $5.20 per share offer we have in the market. There is no other offer on the table for Abano shareholders. “

According to Alscher, Crescent’s offer of $5.20 per share is even more compelling now given the current declining equity markets with the NZX falling over 16% since October last year.

“Our offer remains a full offer and there will be no scaling of acceptances. We will simply waive the 90% condition so that the threshold for going unconditional becomes 50%. Our offer provides shareholders with the opportunity to realise $5.20 cash per share now rather than relying on Abano’s forecasts in an increasingly volatile marketplace with an increasingly pessimistic outlook.”

The $5.20 offer for Abano shares is in the top third of the valuation range ($4.21 to $5.68) assessed by KordaMentha using the EBITDA multiples of comparable companies and comparable transactions and is within the overall valuation range of between $5.15 to $5.90 set out in the KordaMentha Independent Adviser’s report. The top end of this range was based on the Abano Board’s 5½ year projections for the company. Global sharemarkets and the outlook for the New Zealand economy have fallen considerably since these projections and the KordaMentha report were produced.

“The alternative for shareholders will be that they will have to rely on Abano achieving its uncertain projections over the next 5½ years. Clearly this is a risk that large and informed investors were not prepared to take as many have already sold their Abano shares to us. It is our opinion that if Healthcare Industries had not purchased its 20% stake, we would have been successful in achieving a 90% shareholding. There is clear value in our offer for all shareholders,” concluded Mr Alscher.

_Crescent Capital Partners is an Australian based private equity fund which owns and operates Australia’s largest non-government audiology business.

The graph below demonstrates the potential value at risk to Abano shareholders if the Crescent Offer is unsuccessful. Adjusting the share price of Abano that existed prior to any takeover activity for movements in the NZX since that time suggests shareholders may be risking up to $2.28 per share if they reject the offer. Even taking the point from when the company’s 51/2 year projections were first released to the market and adjusting for movements in the NZX since that time suggests shareholders may be risking up to $1.57 per share if the offer is rejected.


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