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Netcare - Netcare Supports True And Proper Broad-Based Empowerment
NETWORK HEALTHCARE HOLDINGS LIMITED
(`Netcare`)
(Co. Reg. No. 1996/008242/06)
Code: NTC
ISIN number: ZAE000011953
NETCARE SUPPORTS TRUE AND PROPER BROAD-BASED EMPOWERMENT
Introduction
This announcement appears for record purposes only.
Rationale for Netcare`s opposition to the initial scheme of arrangement between
Bidco and Ahealth
Netcare opposed the scheme of arrangement proposed by Business Venture
Investments Number 790 (Pty) Limited (`Bidco`) between Afrox Healthcare Limited
(`AHealth`), and its shareholders in terms of which Bidco proposed to acquire
the entire issued ordinary share capital of AHealth (`the scheme`). The
motivation for the opposition was the fact that Medi-Clinic Limited (`Medi-
Clinic`) would in terms of the scheme transaction acquire a 25% shareholding in
the new Ahealth and had a separate arrangement to acquire selected hospital
assets from the new AHealth. This, in Netcare`s view, would certainly have
resulted in a substantial lessening of competition in the private healthcare
market, and left the new AHealth and its controlling empowerment shareholders
with denuded healthcare assets.
Terms of the Settlement Agreement
- In terms of a settlement agreement that was made an order of court on
2 December 2004, Medi-Clinic withdrew from Bidco and abandoned all
initiatives in relation to AHealth. The salient terms of the
settlement agreement are as follows:
- Medi-Clinic and/ or any of its subsidiaries or any other entity controlled
by it or controlling it withdraws from Bidco and sells its shares in Bidco;
- the Disposal and Co-operation Agreement entered into between Bidco and Medi
Clinic is cancelled and it is affirmed that there is no intention or
agreement for such or similar agreements to be resuscitated;
- African Oxygen Limited (`Afrox`), Ahealth and Bidco warrant that they have
not granted any option or pre-emptive right to Medi-Clinic in relation to
their proposed shareholding in Bidco;
- Afrox, Ahealth and Bidco warrant and undertake that no other equity funders
in Bidco have granted any option or pre-emptive right to Medi-Clinic in
relation to their proposed equity interest in Bidco;
- Afrox, Ahealth and Bidco shall not transfer their direct or indirect
interests in Ahealth or any of its subsidiaries or its assets to any third
party with the intention that such third party acts in relation to such
interest or assets in a manner contrary to the aforementioned intentions;
and
- It has been agreed that all of Netcare`s costs incurred since the inception
of the Competition Commission process, including all costs associated with
the High Court application will be repaid to Netcare on an attorney own
client scale.
Conclusion
Mr Michael Sacks, the Netcare Chairman said that, `Having regard to the
appropriate interventions, the threat to competition in the private healthcare
market has been removed and a viable empowerment enterprise has been
established. Netcare welcomes the involvement of credible black empowerment
investors in the private healthcare market and wishes the Bidco consortium every
success.`
Sponsor Attorneys
Merrill Lynch South Africa Webber Wentzel Bowens
Date: 02/12/2004 04:30:08 PM
Produced by the JSE SENS Department
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