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Connor Gains Overseas Investment Office Approval

NZX and Media Release

24 October 2014

Connor Gains Overseas Investment Office Approval

Connor Healthcare Limited (Connor) today advised that it had now obtained Overseas Investment Office (OIO) consent for its $7.25 per share cash takeover offer for Acurity Health Group Limited.

The takeover offer has already been unanimously endorsed by Acurity’s Independent Directors, and Connor has already received acceptances from Acurity shareholders which, when taken with its current holding, and the shares held by Acurity directors who have confirmed that they will accept the offer, represent over 79% of Acurity’s shares. Connor’s offer, which is scheduled to close on the 21st of November, remains subject to conditions including a 90% minimum acceptance condition and Commerce Commission clearance.

Connor’s spokesman Mark Stewart said: “We are very pleased with the progress of the offer. Having the OIO approval now under our belt we are looking forward to hearing from the Commerce Commission. Our offer price is clearly very attractive to shareholders who have already been quick to accept our offer. We continue to believe that the meagre total returns over the last four years, the lack of liquidity in the shares, the required capital expenditure on Wakefield hospital, the costs associated with the NZX listing and the lack of scale and institutional shareholder support means that Acurity is best suited to being an unlisted private company.”

Acurity recently indicated that it expected to spend between $45 million and $50 million to rebuild its flagship Wakefield hospital to meet earthquake code requirements. This capital expenditure represents between $2.00 and $3.00 per share to maintain the existing capacity at the hospital. A further $10 million is required to upgrade the current Wakefield Medical Consultant Centre taking the total estimated capital expenditure required to $60 million.

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About Connor Healthcare

Connor Healthcare is a company established by two existing shareholders in Acurity: Austron Limited and Sydney-based Evolution Healthcare (NZ) Pty Limited (which will own 25% of Connor on completion of the takeover).

Austron is an incorporated joint venture between the Royston Hospital Trust Board and interests associated with the Stewart Family of Christchurch.

Evolution is a leading provider of healthcare services in Australia and New Zealand. Evolution’s focus is to invest in private healthcare facilities, attract and train the best staff and partner with leading healthcare providers to offer patients excellence in healthcare. Evolution separately owns and operates Shellharbour Private, South Coast Private, Boulcott, Canberra Private and Waratah Private hospitals.


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