Advance Healthcare Group is planning a clean sweep of its board of directors and a change of name to that of its major subsidiary, pharmaceutical wholesaler Cottman Medical Products Group.
The loss-making company has also disclosed that it will need up to a further $5 million in working capital to meet its requirements for the next 12 months.
This would be in addition to a $10 million capital injection by Hawkewsbridge Private Equity, which shareholders will be asked to approve at the company’s AGM next month.
Advance is in the midst of a major restructuring that recently appointed chief executive Ken Atkinson hopes will have the company trading profitably by the end of 2006.
In the meantime, Hawkesbridge chairman Christopher Rowe has taken over as chairman of the company.
Other new directors planning to join the board are GHD environmental consultant Ray Steedman, Quay Capital corporate adviser Adrian Loader, and pharma-ceutical executive Malcolm Cole.
The outgoing directors include Peter Woods, the chairman of the NSW Local Government Superannuation Scheme, and Alex Bajada, the former chairman of the WA Local Government Superannuation Plan.
They were unable to make a recommendation on the proposed capital raising because they were also directors of Hawkesbridge.
However, Advance’s independent director, Chris Denz, recommended that shareholders support the restructuring, which was likely to result in Hawkesbridge owning at least 46 per cent of the company.
This was backed by independent expert HLB Mann Judd, which concluded that the restructuring was fair and reasonable.
Hawkesbridge has agreed provide convertible note facilities of $10 million and to convert an existing debt of $2.4 million into shares.
This debt was originally provided by the WA Local Government Superannuation Plan, in the form of convertible notes.
Advance said it was considering options to raise the extra $5 million it will need.
It plans to seek the relisting of its shares on the Australian Stock Exchange after the shareholders meeting.
