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ALA`s Anne:Sun Healthcare

Document date:  Fri 15 Oct 1999
Published:  Fri 15 Oct 1999 00:00:00
Document No:  193563
Document part:  A
Market Flag:  N
Classification: 

ALPHA HEALTHCARE LIMITED                      1999-10-15  ASX-SIGNAL-G

HOMEX - Sydney                                                        

+++++++++++++++++++++++++
Sun Healthcare Group Inc (USA) yesterday filed petitions to
reorganise the Company's debt obligations under Chapter 11 of the
United States Bankruptcy Code.

Sun Healthcare Group Australia Pty Ltd ("SHGA") is a 38% shareholder
in Alpha Healthcare Limited. SHGA, (through a holding company) is 90%
owned by the 0
Sun US parent.

Mr Chet Bradeen, Senior Vice President of Sun Healthcare Group
Australia Pty Ltd advised Alpha that this filing for reorganisation
in the United States "will have no impact on (Sun's) Australia/Asia
Pacific commitment and operations".

This action taken by Sun in the US will have no day to day effect on
Alpha Healthcare and will have no effect on major projects such as
Alpha Westmead Private Hospital. Alpha/Sun funding of this project is
complete and the major0
 tender (ANZ Banking Group) commences its
contributions as of today (15th October 1999).

Alpha's debt position with Sun comprises

a) a subordinated loan of $17.4 million used to finance the first
   stages of the Alpha Westmead Private Hospital project;

b) a $10 million convertible note; and

C) an outstanding balance of approximately $500K on a $4.75 million
   loan advanced to Alpha by Sun in December 1998. Alpha has prepaid
   $1.2 million of the agreed repayment schedu0
le in relation to this
   loan.

The directors believe that Sun Healthcare Inc (US) filing for Chapter
11 reorganisation does not provide any opportunity for early
repayment of any of these outstanding debts.

Alpha Healthcare's Managing Director, Mark Compton, said "We are
given to understand from Sun that the major financial problems
affecting Sun Healthcare Group in the US have been brought about by
legislative change which has also resulted in other large aged cared
provi0
ders in the US filing petitions under Chapter 11 of the US
Bankruptcy Code and placing all others in significant financial
difficulties.

The Directors of Alpha are pleased to announce:

a) the completion of the sale of its radiology operations to a wholly
   owned subsidiary of Mayne Nickless Limited; and

b) the commencement of drawings - which will occur on 18th October
   1999 - under the ANZ senior debt facility to fund all further 
   stages of construction of the Alpha0
 Westmead Private Hospital.

Alpha Healthcare is a publicly listed diversified Australian
healthcare group that is committed to delivering the highest possible
quality of healthcare. The Company's operations span ten hospitals,
family healthcare centres, and occupational rehabilitation.

ENDS:

Media Enquiries:

Mark Compton
MANAGING DIRECTOR
Phone: (02) 9247 8439

Neil Hooper
CHIEF FINANCIAL OFFICER AND COMPANY SECRETARY
Phone: (02) 9247 8439

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