CML Healthcare Income Fund to acquire two medical imaging operations

Oct 7 2009

CML HealthCare Income Fund (the "Fund" or "CML HealthCare"), (TSX: CLC.UN) today announced that its operating subsidiary, CML HealthCare Inc. ("CML") has entered into definitive agreements to acquire two medical imaging operations comprising six centers located in the Northeast United States. These medical imaging operations include: i) The Imaging Institute ("TII") in Providence, Rhode Island; and ii) The Quarry Lake Imaging Centre ("Quarry Lake") in Baltimore, Maryland. The Quarry Lake acquisition closed on July 31, 2009, and TII is expected to close in the fourth quarter of 2009. The acquisitions are expected to be immediately accretive to the Fund's distributable cash(1) on a per unit basis.

In addition to these acquisitions, CML has entered into a joint venture agreement with Upper Chesapeake Health System ("UCHS") to operate a multi-modality medical imaging center in Bel Air, Maryland. This new facility was opened on August 8, 2009.

"We are pleased to execute on our stated strategy of growing our U.S. medical imaging business through 'tuck-in' acquisitions in the U.S. Northeast region," said Paul Bristow, President and CEO of CML HealthCare. "The Rhode Island acquisition is significant as it provides us with an entry into outpatient imaging in New England with a solid platform for future growth in that region. We are excited to work with TII's team of professionals led by Dr. Daniel DiPrete, former President of the Rhode Island Radiology Society and the former Chief of Diagnostic Imaging at South County Hospital in Rhode Island, as they are recognized leaders in the region and share our vision of providing quality patient care and sound, ongoing physician relationships."

"While the Quarry Lake acquisition and the UCHS joint venture are smaller in scope, they are both important transactions in our key Maryland network," continued Mr. Bristow. "The UCHS joint venture will provide CML with its first multi-modality outpatient imaging center in Harford County, Maryland, and it will enhance our ability to offer a comprehensive network to all payors. The Quarry Lake acquisition will add needed MRI and CT capacity in the Baltimore, Maryland area and will increase our overall market share and competitive position. We welcome the staff from these two new centers, and look forward to working with them to deliver quality patient care in each of their respective communities."

Source: CML HEALTHCARE INCOME FUND