Acquisition of US Hospital Sterilisation Facility

Acquisition of US Hospital Sterilisation Facility

Wednesday 21st March 2012

- First step into the United States hospital sterilisation market -

- Will be integrated within the Americas region -

Synergy Health (LSE: SYR), a leading global provider of outsourced sterilisation services to the medical device market and healthcare sector, announces the acquisition of MSI Surgical Solutions LLC ("MSI") from Empire Investment Holdings for a cash consideration of US$6.5 million (approx. £4.1 million), which will be funded out of existing debt facilities.

MSI operates a hospital sterilisation facility in New York, and is the second largest provider of these outsourced services in the United States. The business primarily provides a sterile instrument rental service in the Tri-State area although it has begun expanding its services as a complete outsourced service provider to the healthcare market. The business recorded revenues of US$4.0 million (approx. £2.5 million) in the year ended 31 December 2011, and has been acquired for a cash consideration that equates to a 6.5x EBITDA multiple.

The acquisition of MSI is an early step in the plan to develop a hospital outsourcing service within the United States. Synergy will now work with MSI's customer base to further its knowledge of the market and research the required coverage and configuration with the expectation of starting to develop a network in 2013.

This entry into the US hospital sterilisation market follows the Company's first acquisition in the US in April 2011 when Synergy acquired BeamOne, the largest provider of outsourced, e-beam medical device sterilisation services in the US.

Richard Steeves, Chief Executive of Synergy Health, said:

"The acquisition of MSI is an exciting first step for Synergy into the US hospital sterilization market. By having a small, but low risk entry point into this market, we will be in a position to fully research the requirements of the US healthcare market and set ourselves up for a progressive expansion of the service in 2013."

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