Abano announces cash return for shareholders
CASH RETURN FOR ABANO SHAREHOLDERS
Abano Healthcare Group, today announced details of a proposed one-off cash return of capital to be offered to shareholders, subject to the approval and settlement of the sale of Abano’s aged care business, ElderCare.
The cash return, of NZ$10 million, is conditional on a number of factors, including relevant Inland Revenue approvals, completion of the sale of the ElderCare business, and certain minimum threshold shareholder acceptances. Further details of the share buy-back will be sent to shareholders in coming weeks.
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. At that time, the chairman of Abano, Mr Jim Syme, told the market that the Group hoped to make a payment to shareholders, of up to the amount of the capital gain that was realised on the sale.
Today, Ms Alison Paterson, an independent director on the Abano board, provided further details on the cash return: “The board proposes that a return of capital of $10m will be made by way of an off-market pro-rata voluntary share buy-back. We will be working towards completion of the capital return by late August 2005 and will advise further details, including the record date, buy-back offer price and ratio of shares to be cancelled, in due course.”
She continued: “If the proposed share buy-back and cancellation is approved by the Inland Revenue Department and taken up by a threshold minimum number of shareholders, this is the most tax effective mechanism to return capital to shareholders. For the majority of shareholders, this will be tax free.”
Managing director of Abano, Mr Alan Clarke, commented on these announcements: “The sale of the ElderCare business will provide us with capital funding to finalise our negotiations on a number of new businesses which are less capital intensive, and generate a higher return on investment for our shareholders.
“This is an extremely positive period for Abano Healthcare Group, and we are excited at the future potential for the company. We are also very pleased with the opportunity to thank our shareholders for their ongoing support, with the proposed capital reduction and share buyback”.
Abano Healthcare Group is holding a special meeting for shareholders on 6 July, to seek shareholder approval for the sale of the ElderCare business.
For more information, please contact:
Managing director, Abano Healthcare Group
Tel: 09 361 0482 or mob: 021 368 818