Re: Statements by Arundel LLC (4115N)

TIDMHLO

RNS Number : 4115N

Healthcare Locums PLC

01 September 2011

Healthcare Locums plc

Re: Statements by Arundel LLC

The Board of Healthcare Locums plc ("HCL" or the "Company") notes recent speculation prompted by statements from Arundel LLC ("Arundel") which, although addressed to the Company, have been distributed to the UK media and through the Regulatory News Service of the London Stock Exchange.

The Board believes that the circular dated 19 August 2011 (the "Circular") contains all relevant information that Shareholders need to make an informed voting decision in relation to the Refinancing at the General Meeting on 12 September 2011. The Board considers the that correspondence from Arundel presents a misleading impression of the Company's present situation. Accordingly, there are several points of clarification which the Board considers of material importance and should be communicated to shareholders.

Arundel, which informed the Company in June that it holds 0.5% of the total issued share capital in the Company, has indicated that it opposes the recommended Refinancing and has asserted that it has the support of a total of 21.6% of the Company's shareholders. It has been invited by the Company to substantiate that claim and to provide particulars of those shareholders but has not done so.

It has been demanded by Arundel that the Board explore alternative refinancing solutions. Prior to the posting of the Circular to shareholders on 19 August 2011, detailing the recommended Refinancing, the Company explored a range of alternatives that would deliver in the timeframe available the optimum value for stakeholders and revise the Company's current capital structure to allow a strengthened business to move forward.

The Board believes that the Refinancing, if completed, will provide the Group with a strengthened balance sheet and additional cash funding for operational initiatives, thereby creating a viable, more sustainable capital structure giving it the capability to achieve significant returns. As per the recommendation in the Circular to shareholders, the Board believes the Refinancing to be in the best interests of the Company. The Board has received no other concrete proposal for the restructuring of the Group's indebtedness which would provide the opportunity to maintain any shareholder value. In the event that the Board receives a workable superior alternative restructuring proposal which addresses the relevant time constraints it will, of course review the position.

As indicated in the Circular, the Directors believe the consequences facing the Company if the Refinancing is not approved are serious and not in the best interests of shareholders. In the event that the Refinancing Resolutions are not passed at the General Meeting and the Refinancing is not implemented, then the Group will be unable to satisfy its existing financial covenants and/or service its existing borrowings or meet its ongoing funding requirements without further support from the Lenders. In such event, the Group would be in default under the Existing Facilities. Such a default under the Existing Facilities, in addition to any default which may subsist due to misrepresentations made under the terms of the Existing Facilities at the time they were entered into, would entitle the Lenders to demand repayment of the Existing Facilities. Further, if the Refinancing does not proceed, the Banks have informed the Company that they will only continue to support the business on the basis that a sale of all or part of the Group is pursued. This would be likely to involve formal insolvency proceedings for all or part of the Group. This would, in the Board's opinion, result in Shareholders receiving no value for their current shareholdings.

The challenges facing the Company are both serious and time critical. Any further delay in finalising a restructuring plan could put the Company at serious risk and result in the cancellation of the Company's shares from trading on AIM. On the basis of the Refinancing, the Board has been able to negotiate a credit facility, being the Interim Working Capital Facility, to enable the Company to continue operating.

All shareholders are urged to read carefully the Circular. The Board recommends that shareholders vote in favour of the Refinancing.

As indicated in the Circular, the General meeting will be held at 11.00 a.m. on 12 September 2011. All forms of Proxy must be completed and submitted by 11.00 a.m. on 8 September 2011. The latest date for acceptance of the Open Offer is 11.00 a.m. on 6 September 2011.

Note:

Capitalised terms in this announcement have the same meaning as set out in the Definitions section of the Circular unless stated otherwise.

Contact details:

Healthcare Locums Plc

Peter Sullivan, Chairman

Tel: 0207 451 1451

Fairfax I.S. PLC

Nomad and Joint Broker

Simon Bennett/Ewan Leggat/Laura Littley

Tel: 020 7598 5368

Hawkpoint Partners Limited

Financial Adviser