Northstar Healthcare Issues Statement on Shareholder Rights Plan



    TORONTO and HOUSTON, Feb. 24 /CNW/ - Northstar Healthcare Inc. (TSX:NHC)
As previously announced by press release dated February 9, 2009, Northstar
Healthcare Inc. ("Northstar" or the "Company") had been notified by Donald
Kramer, MD, founder and former Chief Executive Officer and director of
Northstar, that he had been considering making an offer to purchase all of the
outstanding common shares of the Company. In a press release also dated
February 9, 2009, Dr. Kramer confirmed that he is leading a group of
physicians that intends to make such an offer at a price of Cdn$0.95 per
common share in cash (the "Proposed Kramer Offer").
    Dr. Kramer noted that the Proposed Kramer Offer would be subject to
certain conditions, including the waiver of Northstar's shareholder rights
plan dated as of October 15, 2008 (the "Shareholder Rights Plan"). The board
of directors has determined that such a waiver would not be in the best
interest of Northstar's shareholders at this time. Robert Kanee, Chairman of
the committee of independent directors, stated: "The Shareholder Rights Plan
was put in place in order to provide the board with sufficient time to
consider all strategic alternatives to maximize shareholder value in the face
of an unsolicited take-over bid, such as the one being proposed by Dr. Kramer.
Given that we have just commenced a strategic review process, it would be
imprudent at this time to waive the application of the Shareholder Rights
Plan."
    The Shareholder Rights Plan generally provides for the issuance by the
Company of one right (a "Right") in respect of each common share of the
Company outstanding, with each Right permitting the holder thereof to purchase
common shares of the Company at a 50% discount to market price. The issuance
of the Rights is not dilutive until the Rights separate from the underlying
common shares and become exercisable.
    As the Proposed Kramer Offer is not a Permitted Bid (as defined in the
Shareholder Rights Plan), the Rights are scheduled to separate from the common
shares at the close of business on February 24, 2009, which is the tenth
trading day after the announcement of the Proposed Kramer Offer (the
"Separation Time"). At the Separation Time, the Rights will separate from the
common shares, become exercisable and a Rights certificate will be mailed to
each holder of record of common shares as of the Separation Time.
    In order to provide the Company's special committee with sufficient time
to conduct its previously announced strategic review, the board of directors
has exercised its discretion under the Shareholder Rights Plan to delay the
Separation Time until a date to be determined by the board of directors. This
means that the Rights are not yet exercisable, nor will certificates
representing the Rights be issued at this time. Notwithstanding the delay of
the Separation Time, the Shareholder Rights Plan remains in full force and
effect.

    
    About Northstar
    ---------------
    
    Northstar owns and/or manages ambulatory surgery centers in the United
States, focusing initially on Houston and other metropolitan areas in Texas.
Northstar currently holds interests in two ambulatory surgery centers in
Houston - a 70% partnership interest in The Palladium for Surgery - Houston
and a 60% partnership interest in Medical Ambulatory Surgical Suites. In
addition, Northstar manages an ambulatory surgery center in Dallas, which it
has an option to acquire, and three pain management clinics in Houston.
    Northstar was founded and sponsored by Donald Kramer, M.D. and Stewart A.
Feldman. Mr. Feldman also served as the co-principal and Chairman and Chief
Executive Officer of Healthcare Ventures, Ltd., which sponsored Northstar,
with Dr. Kramer serving as its President.

    
    Forward Looking Statements
    --------------------------
    
    This press release may contain forward-looking statements (within the
meaning of applicable securities laws) relating to business of Northstar 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. These statements are
based on the Company's expectations, estimates, forecasts and projections.
They are not guarantees of future performance and involve risks and
uncertainties that are difficult to control or predict. These risks and
uncertainties are discussed in the Company's regulatory filings available on
the Company's web site at www.Northstar-Healthcare.com or at www.sedar.com.
There can be no assurance that forward-looking statements will prove to be
accurate as actual outcomes and results may differ materially from those
expressed in these forward-looking statements. Readers, therefore, should not
place undue reliance on any such forward-looking statements. Further, a
forward-looking statement speaks only as of the date on which such statement
is made. The Company undertakes no obligation to publicly update any such
statement or to reflect new information or the occurrence of future events or
circumstances.


    %SEDAR: 00025141E




For further information:

For further information: Philip Koven, Tel: (416) 447-4740 Ext. 235,
E-mail: info@northstar-healthcare.com

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Northstar Healthcare Inc.

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