News

31st Mar 2006

ASX Announcement

Working Capital Funding

ASX-listed pharmaceutical, consumable and medical products provider Advance Healthcare Group Ltd (ASX: AHG) today announced that Hawkesbridge Private Equity has agreed to provide a significant working capital facility of $10 million to the group, pursuant to a Convertible Note Deed.
Hawkesbridge manages $100 million in private equity funds for institutional investors and invests in capital expansion opportunities.
Mr Joshua Rowe of Hawkesbridge, said the facility was a vote of confidence in the potential growth of AHG's underlying business.
Hawkesbridge is already the largest shareholder in AHG and proposes to significantly increase that shareholding. Approval will be sought for the package from shareholders at an AGM/EGM, likely to be held in May 2006.
At the AGM/EGM shareholders are also expected to be asked to approve a number of other key initiatives, including a change in the company's name and the appointment of new directors, which are part of the measures being taken to create a solid base for growth.
Under the terms of the Convertible Note Deed, Hawkesbridge will provide an initial loan facility of $7.5 million. To date, AHG has already drawn $5.5 million of this $7.5 million facility, with the balance to be made available when security documentation has been signed.
Upon AHG obtaining shareholder approval at the proposed AGM/EGM, the $7.5 million loan facility together with accrued interest will become a convertible note facility. A further $2.5 million convertible note drawdown facility will also be available subject to obtaining the necessary shareholder approvals and satisfying other conditions precedent. The key terms of the proposed convertible note facilities are:

the facilities are for four years at an annual interest rate of 10%;
interest is capitalised and becomes payable at the end of the facility;
Hawkesbridge is able to convert its outstanding debt at anytime at the lower of 2 cents or 90% of the average share price over the preceding 30 days; and
Hawkesbridge obtains security over the assets of the group.

In addition, Hawkesbridge is entitled to two seats on AHG's board. "We are pleased that Hawkesbridge has agreed to become a cornerstone investor in the business and we would like to thank Mr Joshua Rowe and his team for their funding and long-term commitment to the business," AHG's Interim CEO, Mr Loader, said.
"There's no doubt that AHG's pharmaceutical, medical surgical products and medical equipment distribution businesses, Cottman Australia and Medical Products Group, have significant potential to expand. The funding will provide additional working capital within the group to ensure the continued improvement of the service levels provided to our customers."

30th Mar 2006

New CEO Announcement

Mr Ken Atkinson, formerly a senior manager of Australian Pharmaceutical Industries Limited ("API"), has been appointed CEO of AHG. He took up his new position on 27 February 2006.
Mr Adrian Loader, CEO of AHG since September 2005 has stepped down and Mr Atkinson has taken up his position. It is proposed that Mr Loader will become a director of AHG. The AHG Board would like to thank Mr Loader, a director of corporate advisory firm Quay Capital, for the role he has played over the past 5 months. He has undertaken a full review of the AHG group, reorganised operations, sourced funding for the group and recruited Ken Atkinson as the new CEO. Mr Atkinson joins AHG after nearly nine years as a senior manager with API and prior to this spent over 18 years with Sigma in various senior management roles.
Ken's most recent position was State Manager of API's NSW and ACT pharmacy distribution business encompassing eight distribution sites with over 300 employees which represented approximately 50% or over $1 billion of API's national turnover.
"We are very fortunate to have gained a CEO with Ken's extensive experience from within the medical products distribution industry. Ken's general management expertise and all-round skills embrace the disciplines that are vital for our business development," AHG's Chairman, Mr Peter Woods, said.
"Importantly, Ken has extensive experience within our core Western Australia and South Australian markets. Ken was previously State manager for API in WA, South Australia and the Northern Territory and was responsible for the establishment of API's pharmacy business in those states."
"Ken has also been involved extensively as an industry representative on the wholesalers' industry association (NPSA) during periods of great change and is a former vice president."

5th Aug 2005