NETCARE, CLINICS, EXCEL - CAUTIONARY ANNOUNCEMENT

NETWORK HEALTHCARE HOLDINGS LIMITED
(REGISTRATION NUMBER 96/08242/06)
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
("NETCARE") 'LOGO'
CLINIC HOLDINGS LIMITED
(REGISTRATION NUMBER 87/04106/06)
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
("CLINICS")
(COLLECTIVELY "THE NETCARE GROUP")
'LOGO'
EXCEL MEDICAL HOLDINGS LIMITED
(REGISTRATION NUMBER 97/04526/06)
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
("EXCEL")
CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION

RAND MERCHANT BANK LIMITED ("RMB") AND INVESTEC BANK LIMITED ("INVESTEC") ARE
AUTHORISED TO ANNOUNCE THAT, FURTHER TO THE CAUTIONARY ANNOUNCEMENTS BY THE
NETCARE GROUP AND EXCEL DATED 4 MAY 1998 AND 18 MAY 1998 RESPECTIVELY, AND
SUBJECT TO THE CONDITIONS SET OUT BELOW, THE NETCARE GROUP INTENDS TO ACQUIRE
THE ENTIRE ISSUED ORDINARY SHARE CAPITAL OF EXCEL, EITHER BY WAY OF AN OFFER
("THE OFFER") OR BY WAY OF A SCHEME OF ARRANGEMENT BETWEEN EXCEL AND ITS
SHAREHOLDERS ("THE SCHEME") (COLLECTIVELY REFERRED TO AS "THE "PROPOSAL").
2. THE PROPOSAL

THE NETCARE GROUP SHALL INTENDS TO MAKE THE PROPOSAL TO EXCEL SHAREHOLDERS IF
THE FOLLOWING CONDITIONS ARE MET:

- THE HOLDERS OF AT LEAST 50.01% (OR SUCH LESSER PERCENTAGE AS THE NETCARE
GROUP MAY ACCEPT) OF ALL THE EXCEL SHARES UNDERTAKING TO SUPPORT THE PROPOSAL
IF MADE;

- THE EXCEL BOARD OF DIRECTORS CONSENTING, INTER ALIA, TO RECOMMEND THE
PROPOSAL TO EXCEL SHAREHOLDERS; AND

- THE COMPLETION, TO THE SATISFACTION OF THE NETCARE GROUP, OF A DUE DILIGENCE
INVESTIGATION OF EXCEL.

THE PROPOSAL WILL BE MADE, INTER ALIA, ON THE FOLLOWING TERMS AND CONDITIONS:
2.1 STRUCTURE OF THE PROPOSAL

THE PROPOSAL WILL BE EFFECTED BY NETCARE'S LISTED SUBSIDIARY CLINICS, ACQUIRING
ALL OR PART OF THE ENTIRE ISSUED SHARE CAPITAL OF EXCEL, THE CONSIDERATION FOR
WHICH SHALL BE SATISFIED BY THE ALLOTMENT TO EXCEL SHAREHOLDERS OF CLINICS
SHARES IN RENOUNCEABLE FORM, WHICH SHARES ARE TO BE RENOUNCED IN FAVOUR OF
NETCARE FOR NETCARE SHARES.  THE ISSUE PRICE OF THE CLINICS SHARES WILL BE
DETERMINED BY CLINICS, SUPPORTED BY AN APPROPRIATE FAIR AND REASONABLE OPINION,
BY THE EARLIER OF 3 AUGUST 1998 AND THE FOURTH DAY PRIOR TO THE CIRCULATION TO
EXCEL SHAREHOLDERS OF THE REQUIRED DOCUMENTS IN RESPECT OF THE PROPOSAL.
2.2 PROPOSED CONSIDERATION

EXCEL SHAREHOLDERS WILL EFFECTIVELY BE OFFERED, IN EXCHANGE FOR THEIR EXCEL
SHARES, A NUMBER OF NETCARE SHARES IN A RATIO ("THE EXCHANGE RATIO") THAT WILL
BE DETERMINED ON THE BASIS OF THE 15 DAY VOLUME WEIGHTED AVERAGE PRICE AT WHICH
NETCARE SHARES TRADE ON THE JOHANNESBURG STOCK EXCHANGE ("THE JSE") ("NETCARE
WEIGHTED PRICE") ON THE DATE REFERRED TO IN 2.1.

THE EXCHANGE RATIO HAS BEEN DETERMINED AT 100 NETCARE SHARES FOR EVERY 208
EXCEL SHARES HELD, BASED ON PRICES OF 260 CENTS AND 125 CENTS PER NETCARE SHARE
AND EXCEL SHARE RESPECTIVELY.  THE EXCHANGE RATIO WILL BE ADJUSTED ACCORDING TO
A SPECIFIED FORMULA, SHOULD THE NETCARE WEIGHTED PRICE EXCEED 260 CENTS.  THIS
IS ILLUSTRATED IN THE FOLLOWING TABLE:

NETCARE WEIGHTED    NUMBER OF EXCEL SHARES         EFFECTIVE PRICE PER
PRICE (CENTS)       PER 100 NETCARE SHARES         EXCEL SHARE (CENTS)
208-259             208.00                         100.00-124.52

260-269             208.00                         125.00-129.33

270-279             212.60                         127.00-131.23

280-289             217.05                         129.00-133.15

290-299             221.37                         131.00-135.07

300-309             225.56                         133.00-136.09

310-344.41          229.63                         135.00-149.99

344.5-4001          229.67-240.00                  150.00

   SHOULD THE NETCARE WEIGHTED PRICE EXCEED 310 CENTS, THE EXCHANGE RATIO WILL
BE CALCULATED ON THE HIGHER OF 310 CENTS AND 90% OF THE ACTUAL NETCARE WEIGHTED
PRICE AND 135 CENTS PER EXCEL SHARE.
2.3 CONDITIONS PRECEDENT

THE PROPOSAL ITSELF WILL BE CONDITIONAL, INTER ALIA, ON THE FOLLOWING
CONDITIONS:

2.3.1 IN THE CASE OF THE OFFER, THAT IT BE ACCEPTED BY EXCEL SHAREHOLDERS
HOLDING NOT LESS THAN 50.01% (OR SUCH LESSER PERCENTAGE AS THE NETCARE GROUP
MAY ACCEPT) OF THE ISSUED SHARE CAPITAL OF EXCEL;

2.3.2 IN THE CASE OF THE SCHEME, THE ACCEPTANCE OF THE SCHEME BY EXCEL
SHAREHOLDERS AND THE SANCTIONING THEREOF BY THE HIGH COURT IN ACCORDANCE WITH
THE PROVISIONS OF SECTION 311 OF THE COMPANIES ACT, 1973;

2.3.3 THE GRANTING BY THE JSE AND THE SECURITIES REGULATION PANEL OF SUCH
APPROVALS AS MAY BE REQUIRED IN RESPECT OF THE PROPOSAL;

2.3.4 THE GRANTING OF A LISTING BY THE COMMITTEE OF THE JSE IN RESPECT OF THE
CONSIDERATION SHARES;

2.3.5 AGREEMENT BY THE COMPETITIONS BOARD, IN ON TERMS TO THE REASONABLE
SATISFACTION OF THE NETCARE GROUP AND EXCEL, THAT IT WILL NOT TAKE ANY ACTION
TO PREVENT, DELAY OR OTHERWISE IMPEDE THE ACQUISITION RESULTING FROM THE
PROPOSAL; AND

2.3.6 THE PASSING AND, WHERE NECESSARY, REGISTRATION OF SUCH RESOLUTIONS AS MAY
BE NECESSARY TO ENABLE THE NETCARE GROUP TO IMPLEMENT THE ACQUISITION AND THE
PROPOSAL.
2.4 UNDERTAKINGS TO SUPPORT THE PROPOSAL

NETCARE HAS RECEIVED UNDERTAKINGS FROM VARIOUS SHAREHOLDERS OF EXCEL, HOLDING
IN AGGREGATE APPROXIMATELY 30% OF THE EXISTING ISSUED SHARE CAPITAL OF EXCEL
(AND WILL HOLD IN AGGREGATE APPROXIMATELY 39% OF THE ISSUED SHARE CAPITAL OF
EXCEL ISSUED PURSUANT TO THE FULFILLMENT OF EXCEL'S OBLIGATIONS TO ISSUE SHARES
IN ACCORDANCE WITH EXCEL'S PROSPECTUS), TO SUPPORT THE PROPOSAL, PROVIDED THAT
THE NETCARE WEIGHTED PRICE REMAINS ABOVE 208 CENTS.
3. NOTICE TO EXERCISE CAUTION

SHAREHOLDERS OF THE NETCARE GROUP AND OF EXCEL ARE ADVISED TO CONTINUE TO
EXERCISE CAUTION IN DEALING IN THEIR SHARES UNTIL A FURTHER ANNOUNCEMENT IN
THIS REGARD IS MADE.
JOHANNESBURG
4 JUNE 1998