Abano announces details of share buyback

Published Friday 22 July 2005

Abano Healthcare Group today released details of the $10 million capital return to shareholders, following the sale of Abano’s aged care business, ElderCare. Abano is offering to purchase, on a pro-rata basis, one share out of every six shares held by each shareholder on the 5 August 2005, at a price of $2.20 per share.

Media Release
Friday, 22 July 2005

ABANO ANNOUNCES DETAILS OF SHARE BUYBACK

Abano Healthcare Group today released details of the $10 million capital return to
shareholders, following the sale of Abano’s aged care business, ElderCare.

Abano is offering to purchase, on a pro-rata basis, one share out of every six shares held by each shareholder on the 5 August 2005, at a price of $2.20 per share. The share buyback remains conditional on certain minimum threshold shareholder acceptances.

The capital return was first announced in late May, when the company signed a conditional agreement to sell ElderCare to Macquarie Bank for NZ$63.5 million, and was confirmed following shareholder approval of the sale at a special meeting in July.

The $10 million cash return is the amount of the capital gain that was realised on the sale of ElderCare, and will be made by way of an off-market pro-rata voluntary share buyback. The offer is open to people holding shares in Abano as at 5 August 2005, and will close on 26 August 2005.

The maximum number of shares that Abano may take up under this offer is 4,517,572, and assuming all shareholders take up the Offer, shares on issue will be reduced from 27,105,432 to 22,587,860.

Chairman of Abano, Mr Jim Syme said: “This is the most tax effective method available to us to return capital to shareholders. Following the cash return, the Group will still have sufficient funds to invest in a number of new and exciting healthcare opportunities, including the 70 percent acquisition of Bay Audiology”.

As previously announced, Abano will invest $21million in Bay Audiology for a 70 percent
shareholding. The remaining 30 percent will continue to be held by Bay’s three founding
clinical directors and after a five year period, Abano may acquire their shareholdings through a put and call option, based on a pre-determined price formula relating to Bay Audiology’s future earnings, subject to a minimum floor price of $9 million.

This acquisition is subject to shareholder approval at Abano’s annual meeting to be held in
September 2005, and is in addition to the two new investment opportunities in the diagnostics and rehabilitation sectors, as announced at the special meeting of  shareholders on 6 July 2005.

- Ends –

For more information, please contact:

Richard Keys
Chief Financial Officer, Abano Healthcare Group
Tel: 09 361 0352 or mob: 025 818 368