NEWS RELEASE Toronto Stock Exchange Symbol: CLC.UN

CML HealthCare Completes Acquisition of American Radiology Services, Inc.

MISSISSAUGA, Ontario, February 29, 2008 – CML HealthCare Income Fund (the “Fund” or “CML HealthCare”), (TSX: CLC.UN) today announced that it has closed its previously announced acquisition (the “Acquisition”) of Baltimore, Maryland-based American Radiology Services, Inc. (“ARS”) through the acquisition of its holding company ARS Holding, Inc. (“ARS Holding”), for total consideration of approximately US$150.4 million (inclusive of repayment of ARS’ U.S. dollar term debt and capital leases assumed by CML HealthCare), subject to normal post-closing adjustments. The Acquisition was funded with CML HealthCare’s new C$450 million credit facility (the “New Facility”).

ARS generated US$109.0 million in revenue for the nine-month period ended September 30, 2007 (Canadian GAAP). Based on pro forma financial results for the nine-month period ended September 30, 2007, and using the effective exchange rate on February 28, 2008, the Acquisition would have been 7.5% accretive to the Fund’s distributable cash* per unit. (See pro forma distributable cash table below.)

ARS is a leading provider of fully-integrated diagnostic medical imaging services with 15 fixed-site multi-modality and two single-modality outpatient centers in Maryland and Delaware. ARS also provides radiologist coverage to 11 hospitals in Maryland, and primary or secondary reading services via its teleradiology network to 25 hospitals across six states in the U.S. ARS is a regional leader in the U.S. in high-quality medical imaging services, performing approximately 2.2 million medical imaging interpretations per year in conjunction with The Johns Hopkins University and The Johns Hopkins Health System Corporation (collectively “Johns Hopkins”). ARS, through an exclusive, long-term management services contract with American Radiology Associates, P.A. (“ARA”), has access to approximately 70 radiologists and has access to additional radiologists through its affiliation with Johns Hopkins. As part of the Acquisition, CML HealthCare, ARS Holding and Johns Hopkins have agreed to enter negotiations to amend the terms of the future relationship among the parties which could include further initiatives and opportunities in diagnostic medical imaging. For more information on ARS, please refer to the news release: “CML HealthCare Income Fund to Purchase American Radiology Services, Inc.”, dated December 21, 2007.

“CML HealthCare has entered a new phase of growth, while maintaining strict adherence to the financial discipline that has supported our profitable growth since inception. ARS is an excellent operational and strategic fit for CML HealthCare and the transaction is immediately accretive to our distributable cash. We share a common vision with ARS for the delivery of exceptional patient care and for the future of medical imaging and believe ARS augments our competitive strengths and provides a tremendous platform for future growth,” said Paul Bristow, President and CEO of CML HealthCare. “ARS’ geographic concentration of high quality imaging clinics in an attractive regional market provides us with a strong platform to pursue accretive acquisitions of medical imaging assets in the United States. Further, with state-of-the-art imaging equipment, an advanced teleradiology network, robust information systems, and an exceptional pool of radiologists and technicians, ARS has a highly scalable network that can support both U.S. growth and the rollout of our digital imaging implementation in Canada.”

“ARS’ strong management team, led by Robert Carfagno and John Rodgers, will remain with ARS under new employment agreements, and is committed to maintaining operational excellence and continued growth as part of CML HealthCare,” continued Mr. Bristow. “We are pleased to confirm today that ARS management will be retaining an equity interest in ARS. We welcome the entire ARS team to CML HealthCare and look forward to moving ahead with our growth plans.”

Summary Pro Forma Distributable Cash*

The following summary has been prepared on a pro forma basis as if the Acquisition was completed on January 1, 2007.

“When we announced the acquisition, we committed to providing detailed financial information on closing of the transaction,” noted Tom Weber, Chief Financial Officer. “In addition to being a strategic acquisition, the numbers show the acquisition is also very attractive from a financial perspective.”

The Fund today also announced that it has refinanced its C$190 million senior secured notes, through early repayment, with the New Facility and has entered into an interest rate swap agreement at a fixed rate of 4.078% on C$200 million of new term debt (plus applicable credit spreads that management expects to range from 70 to 100 basis points) for a period of five years. The early repayment of the senior secured notes included a “make whole” payment of approximately C$13.5 million.

“The strength of CML HealthCare’s balance sheet is a hallmark of our history and corporate culture. Post acquisition, our balance sheet remains strong, we have locked in a very attractive rate of interest on a significant portion of our debt and both S&P and DBRS have confirmed our stability ratings.” added Mr. Weber. “In addition, we have a C$100 million revolving credit facility in place that is currently undrawn with which to pursue future growth opportunities.”

ARS Holding Summary Financial Information

Lower revenue and earnings for the nine months ended September 30, 2007 compared to the same period in 2006 reflect Medicare reimbursement reductions as a result of the Deficit Reduction Act ("DRA") in the United States, which came into effect on January 1, 2007. These DRA reductions are fully reflected in the 2007 results.

The following table reconciles EBITDA and Adjusted EBITDA to net loss based on the consolidated financial statements of ARS Holding for the indicated periods.

Notice of Conference Call

Management of CML HealthCare Income Fund will host a conference call Monday, March 3, 2008 at 10:30 am (ET) to discuss the closing of the American Radiology Services, Inc. acquisition. A live audio webcast of the call will be available at www.cmlhealthcare.com. Webcast attendees are welcome to listen to the conference in real-time or on-demand at your convenience. A taped replay of the conference call will be available until Monday, March 10, 2008 at midnight at 1-877-289-8525 or 416-640-1917, reference number 21265044#.

About CML HealthCare Income Fund

CML HealthCare Income Fund is an unincorporated open-ended trust that owns CML HealthCare Inc., one of Canada’s largest healthcare services businesses. CML is a leading provider of laboratory testing services in Ontario and the largest private provider of medical imaging services in Canada. CML HealthCare Income Fund is publicly traded on the Toronto Stock Exchange under the symbol "CLC.UN" and has approximately 86.6 million units outstanding. To reach CML HealthCare Income Fund via the worldwide web log on to www.cmlhealthcare.com.

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Caution concerning forward-looking statements

Statements made in this news release, other than those concerning historical financial information, may be forward-looking and therefore subject to various risks and uncertainties. Some forward-looking statements may be identified by words like “may”, “will”, “anticipate”, “estimate”, “expect”, “intend”, or “continue” or the negative thereof or similar variations. Readers are cautioned not to place undue reliance on such statements, as actual results may differ materially from those expressed or implied in such statements. Factors that could cause results to vary include, but are not limited to: dependence on government-based revenues; pending and proposed legislative or regulatory developments including the impact of changes in laws, regulations and the enforcement thereof; intensifying competition from established competitors and new entrants in the businesses in which we operate; technological change; interest rate fluctuations and general economic conditions; insurance coverage of sufficient scope to satisfy any liability claims; fluctuations in operating results; dependence on our operating subsidiary to pay its interest obligations; fluctuations in cash distributions and capital investment; management of credit, market, liquidity and funding and operational risks; judicial judgments and legal proceedings; our ability to complete strategic acquisitions and to integrate our acquisitions successfully; changes in accounting policies and methods we use to report our financial condition, including uncertainties associated with critical accounting assumptions and estimates; operational and infrastructure risks including possible equipment failure and performance of information technology systems; fluctuations in total patient referrals; loss of services of key senior management personnel; other factors that may affect future growth and results including, timely development and introduction of new products and services; changes in our estimates relating to reserves and allowances; future sales of units; changes in tax laws; technological changes and obsolescence, natural disasters, the possible impact on our businesses from public health emergencies, international conflicts and other developments including those relating to terrorism; the effect of anyone or more of such events and risks on our stability ratings and any changes thereto; and our success in anticipating and managing the foregoing risks. Additional factors related to the Acquisition include, but are not limited to, the Fund’s ability successfully to integrate the operations of ARS, additional liabilities or costs attributable to the Acquisition, unknown liabilities of ARS, the ability to retain senior management of ARS, the ability to complete accretive acquisitions in the U.S., the continuation and nature of the relationship with Johns Hopkins and changes in U.S. federal and state healthcare laws and regulations, including with respect to Medicare and Medicaid reimbursements levels.

We caution that the foregoing list of factors is not exhaustive and that when reviewing our forward-looking statements, investors and others should refer to the “Risk Factors” section of the Fund’s Annual Information Form, the “Risks and Uncertainties” and other sections of our Management’s Discussion and Analysis of Operating Results and Financial Position and our other periodic filings with Canadian securities regulatory authorities. All forward-looking statements presented herein should be considered in conjunction with such filings. The Fund does not undertake to update any forward-looking statements; such statements speak only as of the date made.

Definitions of Non-GAAP Measures

(*) Distributable Cash is not a recognized measure under Canadian generally accepted accounting principles (“GAAP”); however, the Fund believes that distributable cash is a useful measure as it provides investors with an indication of cash available for distribution. The Fund’s method of calculating distributable cash may differ from that of other issuers and, accordingly, distributable cash may not be comparable to measures used by other issuers. Investors are cautioned that distributable cash should not be construed as an alternative to the statement of cash flows as a measure of liquidity and cash flows of the Fund.

References to ‘‘EBITDA’’ are to earnings before interest, taxes, depreciation, amortization, other expenses, non-controlling interest and provisions. EBITDA is used by Management in evaluating the Fund’s performance. EBITDA is a metric used by many investors to compare issuers on the basis of ability to generate cash from operations. EBITDA is not a recognized measure under Canadian GAAP and is not intended to be representative of cash flow or results of operations determined in accordance with GAAP or cash available for distribution. Investors are cautioned, however, that EBITDA should not be construed as an alternative to net income as determined in accordance with GAAP or to cash flows from operating, investing and financing activities as a measure of liquidity and cash.

References to ‘‘Adjusted EBITDA’’ are to earnings before interest, taxes, depreciation, amortization, stock compensation expense, equipment write offs, unrealized gain on derivative instruments, and other one time expenses. Adjusted EBITDA is used by Management in evaluating ARS’ performance. Adjusted EBITDA is a metric used by many investors to compare issuers on the basis of ability to generate cash from operations. Adjusted EBITDA is not a recognized measure under Canadian GAAP and is not intended to be representative of cash flow or results of operations determined in accordance with GAAP or cash available for distribution. Investors are cautioned, however, that Adjusted EBITDA should not be construed as an alternative to net income as determined in accordance with GAAP or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows, or as an indicator of ARS’ performance. Adjusted EBITDA may not be comparable to similarly titled amounts reported by other issuers.

For more information, please contact:

Bruce Wigle	Tom Weber
Investor Relations	Chief Financial Officer
The Equicom Group Inc.	CML HealthCare Income Fund
(416) 815-0700 ext 228	(905) 565-0043 ext 204
(416) 815-0080 fax	(905) 565-1776 fax
Email: bwigle@equicomgroup.com	Internet: www.cmlhealthcare.com