Behrman Capital Acquires Majority Interest in Tandem Health Care, Inc.

Investment in Post-Acute Health Care Company
Second For Behrman Capital’s New $518 Million Buyout Fund

April 13, 1998

Behrman Capital, a private investment firm focused on emerging growth companies, today announced that it has become the majority shareholder of Tandem Health Care, Inc., a post-acute health care company based in Pittsburgh.

Founded in April 1997 by Lawrence Deering, former Chief Operating Officer of Mariner Health Care Group, Inc., and Joseph Conte, former President of Mariner Health, Florida, privately-held Tandem utilizes skilled nursing facilities to develop regionally concentrated post-acute health care networks. These networks provide a broad range of services, including skilled nursing, subacute care, assisted living, home health, and rehabilitation therapies. The Company currently operates facilities located in Pennsylvania and Florida.

This transaction marks the second equity investment for Behrman Capital II L.P., which, as previously announced, closed in January 1998 with total committed capital of $518 million.

“The development and integration of post-acute care networks will be a significant factor in the emerging health care environment,” said Lawrence Deering, Tandem Chairman and Chief Executive Officer. “We look forward to our partnership with Behrman Capital as we continue to grow our company. Indeed, with Behrman Capital’s equity commitment, we have over $200 million of financing available for acquisitions and development activities. We are pursuing numerous acquisitions of skilled-nursing facilities and ancillary providers, as well as the development of assisted living facilities.”

“We are excited by the opportunity to participate as partners with Tandem’s strong, experienced management team in the growth of this unique post-acute health care provider,” said Darryl G. Behrman, Managing Partner of Behrman Capital. “This investment demonstrates our continued focus on emerging growth companies in the healthcare sector.”

Behrman Capital invests in management buyouts of growth companies focused on the information technology, health care services and outsourced manufacturing industries, as well as special situations. The firm also provides expansion capital to emerging growth companies, principally in the high technology and health care services industries.

Based in New York and San Francisco, Behrman Capital was founded in 1991 by Darryl G. and Grant G. Behrman. The currently has a combined capital based exceeding $640 million.