Corporate Update

Wednesday 14 December 2011

Southern Cross Healthcare Group PLC

("Southern Cross", "the Company" or "the Group")

Corporate update and completion of homes transfer

Southern Cross announces that, following receipt of regulatory approvals and finalising of formalities, the last two homes operated by the Company (both in Scotland) have today been transferred to new operators.

This concludes the hand over process announced by the Company in its statement of 27 September 2011 and Southern Cross has now ceased to be an operator of care homes. This exercise, the largest transfer undertaken in the care sector, has been achieved while at the same time providing continuity of care for the residents in homes it previously operated.

The Board expresses, on behalf of all stakeholders, its appreciation for the efforts of the former management and staff of the Company, the vast majority of whom have transferred to new operators, for the integrity and determination they showed in making sure this transfer completed. The forbearance and understanding of the Company's Landlords and Lenders has also been remarkable.

Stephen Taylor, Chairman of Southern Cross, said:

"The smooth transfer of the operations has been achieved by close coordinated effort of Southern Cross staff, Commissioners, landlords and new operators with additional key support from many other parties. Continuity of care and minimising concern for residents has been the priority of the whole team and I am grateful for the part that everyone has played."

-Ends-

Enquiries: