Arbitration Panel Denies Dr. Kramer's Motion for Summary Judgment
TORONTO and HOUSTON, June 10 /CNW/ - Northstar Healthcare Inc. ("Northstar" or the "Company") (TSX:NHC) today announced it has issued a Directors' Circular in response to the unsolicited offer (the "Offer") by Canada Healthcare Acquisition Inc. (the "Offeror"), a corporation indirectly controlled by Dr. Donald L. Kramer, a former CEO and former director of Northstar, to acquire all the issued and outstanding common shares of the Company for Cdn $0.95 per common share. Northstar's Directors' Circular was mailed to Northstar shareholders today and has been filed on SEDAR (www.sedar.com). Shareholders are urged to read the Directors' Circular in its entirety.
The board of directors of Northstar (the "Board"), with the benefit of advice from the special committee of independent directors established by the Board (the "Special Committee"), its legal advisors and Canaccord Genuity Corp., the financial advisor to the Board, is carefully reviewing and considering the Offer and identifying and assessing other available alternatives. Based upon its initial review of the Offer and a recommendation from the Special Committee, the Board has unanimously determined to advise shareholders not to tender their common shares to the Offer until further communication is received from the Board. The Board of Directors intends to communicate further with shareholders on or before July 19, 2010.
The following is a summary of the principal reasons for the Board's initial advice:
- The Offer is highly conditional for the benefit of Dr. Kramer. Some
of the conditions are not subject to materiality thresholds or other
objective criteria but rather provide Dr. Kramer with a broad range
of grounds upon which he may decline to proceed with the Offer even
if a sufficient number of shares are tendered to the Offer to satisfy
the Offer's minimum acceptance condition.
- Strategic alternatives are being pursued by Northstar with the
intention to generate value for shareholders that is superior to the
Offer. Tendering shares to the Offer before the Board and its
advisors have had an opportunity to fully explore all available
strategies may preclude the possibility of a financially superior
- Representatives of Dr. Kramer and Northstar are scheduled to meet to
discuss the Offer further. At this time, it is impossible to predict
whether any supported offer or transaction will emerge from these
The Offer remains open for acceptance until 5:00 p.m. (Toronto time) on July 26, 2010, unless extended or withdrawn, and is subject to a number of conditions. Accordingly, there is no necessity for shareholders to take any action with respect to the Offer at this time and the Board is not making a recommendation at this time.
In addition, Northstar also announced that the arbitration panel presiding over the arbitration between Northstar and Dr. Kramer denied Dr. Kramer's Motion for Summary Judgment. The panel's decision denying the motion means that, barring unforeseen events, Northstar will obtain a hearing on the merits of its claim. The panel denied Northstar's motion to dismiss the six counterclaims filed by Dr. Kramer against it, four of which had already been withdrawn by Dr. Kramer in response to Northstar's motion, without prejudice to being able to bring them in a separate proceeding. Further explanation of both decisions of the arbitration panel can be found in the Directors' Circular.
About Northstar Healthcare Inc.
Northstar owns and/or manages ambulatory surgery centres in the United States, focusing initially on Houston and other metropolitan areas in Texas. The Company currently holds interests in two ambulatory surgery centres in Houston - a 70% partnership interest in The Palladium for Surgery - Houston and a 60% partnership interest in Medical Ambulatory Surgical Suites.
This news release may contain forward-looking statements (within the meaning of applicable securities laws) relating to business of the Company and the environment in which it operates. Forward-looking statements are identified by words such as "believe", "anticipate", "expect", "intend", "plan", "will", "may" and other similar expressions. This information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. Forward-looking information in this news release includes, without limitation, statements made in respect of the potential options and alternatives to the Offer that may be available to maximize shareholder value, and other statements regarding management's beliefs, intentions, results, performance, goals, achievements, future events, plans and objects.
All forward-looking statements in this news release are qualified by these cautionary statements. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, should not be unduly relied upon and will not necessarily be accurate indications of whether or not such results will be achieved. Factors that could cause actual results to differ materially from the results discussed in the forward-looking statements, include, but are not limited to a failure to realize on potential options and alternatives to the Offer that may be available. Forward-looking information is based on various material factors or assumptions, which are based on information currently available to Northstar. Material factors or assumptions that were applied in drawing a conclusion or making an estimate set out in the forward-looking information may include, but are not limited to the availability of potential options and alternatives to the Offer. Readers are cautioned that the preceding list of material factors or assumptions is not exhaustive. Although the forward-looking statements contained in this news release are based upon what management believes are reasonable assumptions, Northstar cannot assure readers that actual results will be consistent with these forward-looking statements.
The forward-looking statements contained in this news release are made as of the date of this news release and should not be relied upon as representing Northstar's views as of any date subsequent to the date of this news release. Northstar assumes no obligation to update or revise these forward-looking statements to reflect new information, events, circumstances or otherwise, except as required by applicable law.
SOURCE Northstar Healthcare Inc.
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