16th Dec 2005 16:07
Smith & Nephew Plc16 December 2005 Smith & Nephew realises investment in BSN medical 16 December 2005 Smith & Nephew plc (LSE: SN, NYSE: SNN) announced earlier today the signing,together with Beiersdorf AG its joint venture partner, of an agreement to sellBSN medical ("BSN") for an enterprise value of €1030 million to Montagu PrivateEquity. Completion of the transaction is conditional upon competitionclearances being received and is expected to take place in the first quarter of2006. Smith & Nephew expects its share of the proceeds to be around €495 million (£330million) in cash, after adjusting for net debt of BSN and certain other items,and will be applied in repaying group borrowings. Net assets subject todisposal are £145 million and the gain on disposal will be around £170 million,after transaction costs of around £15 million, and will be accounted for oncompletion. Cash tax of around £20 million will be payable on the transaction. Commenting on the sale, Sir Christopher O'Donnell, Chief Executive of Smith &Nephew, said: "We established BSN with Beiersdorf in 2001 as a planned exit from our lowergrowth hospital supply businesses. Over the last five years through businessrationalisation it has established itself as a highly profitable business and amarket leader in many of its markets. We are very pleased to have achieved thissale at a value which represents nearly twice the revenues of the business forthe current year." Commenting on the effect of the sale on Smith & Nephew, Peter Hooley, FinanceDirector, said: "The sale of BSN enhances the growth prospects and the financial strength ofSmith & Nephew to continue to invest in expanding its businesses. The profitsof BSN, which are accounted for on an equity basis, are expected to contributeapproximately £161/2m after tax to group earnings in 2005. Whilst the sale ofBSN is expected to dilute Smith & Nephew's growth in adjusted earnings per shareby just under 4%, in 2006, it is expected in subsequent years to augment thatgrowth by approaching 1% per annum." Enquiries Investors/Media Liz Hewitt Tel: +44 (0) 20 7401 7646 Smith & Nephew Group Director Corporate Affairs About us Smith & Nephew is a global medical technology business, specialising inOrthopaedics, Endoscopy and Advanced Wound Management products. Smith & Nephewis a global leader in arthroscopy and advanced wound management and is one ofthe fastest growing global orthopaedics companies. Smith & Nephew is dedicated to helping improve people's lives. The companyprides itself on the strength of its relationships with its surgeons andprofessional healthcare customers, with whom its name is synonymous with highstandards of performance, innovation and trust. The company has over 8,500employees and operates in 33 countries around the world generating annual salesof £1.25 billion. Forward-Looking Statements This press release contains certain "forward-looking statements" within themeaning of the US Private Securities Litigation Reform Act of 1995. Inparticular, statements regarding expected revenue growth and operating marginsdiscussed under "Outlook" are forward-looking statements as are discussions ofour product pipeline. These statements, as well as the phrases "aim", "plan","intend", "anticipate", "well-placed", "believe", "estimate", "expect","target", "consider" and similar expressions, are generally intended to identifyforward-looking statements. Such forward-looking statements involve known andunknown risks, uncertainties and other important factors (including, but notlimited to, the outcome of litigation, claims and regulatory approvals) thatcould cause the actual results, performance or achievements of Smith & Nephew,or industry results, to differ materially from any future results, performanceor achievements expressed or implied by such forward-looking statements. Pleaserefer to the documents that Smith & Nephew has filed with the U.S. Securitiesand Exchange Commission under the U.S. Securities Exchange Act of 1934, asamended, including Smith & Nephew's most recent annual report on Form 20F, for adiscussion of certain of these factors. All forward-looking statements in this press release are based on informationavailable to Smith & Nephew as of the date hereof. All written or oralforward-looking statements attributable to Smith & Nephew or any person actingon behalf of Smith & Nephew are expressly qualified in their entirety by theforegoing. Smith & Nephew does not undertake any obligation to update or reviseany forward-looking statement contained herein to reflect any change in Smith &Nephew's expectation with regard thereto or any change in events, conditions orcircumstances on which any such statement is based. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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