Oriola-KD Corporation Stock Exchange Release 7 June 2007 at 9.30 a.m. Oriola-KD Corporation and Lifco AB have agreed to merge their dental wholesale businesses in Finland, Sweden, Norway, Denmark and the Baltic countries to form a new market leader in Northern Europe. Furthermore, Oriola-KD will increase its stake in the new company to be founded to 30 per cent through a further cash contribution of EUR 14 million. Lifco will have a 70 per cent stake of the new company. The new company will have strong complementary geographical presence, product offering and knowledge in local markets. Oriola-KD has a strong market position in Finland and the Baltic countries while Lifco is strong in Sweden, Norway and Denmark. The parties' primary objective is to enhance their offering, efficiency and quality to their customers in each country where they operate while generating growth. The operations, trademarks, assets and subsidiaries relevant to Oriola-KD's and Lifco's dental businesses shall come under a new parent company to be established. Based on combined (pro forma) 2006 figures the Group initially generates some EUR 140 million in net sales with an operating profit of about EUR 13 million. The estimated annual cost synergies of EUR 2 million are expected to come mainly from combined operations in different countries from 2008 onwards. The net sales of Oriola-KD's Dental business in 2006 was EUR 44.0 million and operating profit EUR 1.4 million. The new company has a strong balance sheet with virtually no interest bearing debt. The new company will be headed by Mr. Fredrik Karlsson, current President of Lifco AB, and employ approximately 420 people. All Oriola-KD's dental employees will transfer to the entities of the new group under their current terms and conditions of employment. Number of Lifco Dental's personnel is about 300 and Oriola-KD's Dental Trade business about 120. The joint company will have its headquarters in Enköping, Sweden. Mr. Tero Riikonen has been nominated Managing Director of Oriola-KD's Finnish Dental business as of 7 June 2007. With the new organisation coming into effect Ms. Senja Tynkkynen, Vice President of Oriola-KD Group's Dental Trade business and the member of the Group's management team has resigned. The estimated impact on Oriola-KD's 2007 operating profit is expected to be incremental. The completion of the transaction is expected to take place by early 2008. The transaction is subject to approvals by respective competition authorities."This is a unique opportunity to create a new market leader in Northern Europe. Oriola-KD's Dental Trade business has been developing favourably and the merger with Lifco will create a strategically strong company having even better opportunities to meet the consolidation development in the market. Joining the strengths of both companies provides an excellent foundation to run a successful business in long term. In addition to our dental trade business we will invest EUR 14 million to the new company. The new company will be able to offer to our current and future customers an extended product portfolio, enhanced customer service and long term partnership with decades of experience," said Eero Hautaniemi, President and CEO, Oriola-KD Corporation."We are happy to see this merger materialise. It creates a strong platform for growth in Northern and Eastern Europe. This creates exciting opportunities for our employees who become part of the leading team within the dental field in all the markets where we operate," said Mr. Fredrik Karlsson, President, Lifco AB. About Lifco AB Lifco AB is an industrial group that consists of two main business areas, Lifco Dental Group and Sorb Industries. Lifco Dental Group is Scandinavia's leading wholesaler of dental materials and equipment with more than 25 000 dentists as customers in Sweden, Denmark, Norway and the Baltic countries. Lifco Dental Group has a turnover of approx 100 million Euro. Sorb Industries has a turnover of approx 200 million Euro. The Lifco group employs approx 1350 (2006). Lifco is a wholly-owned subsidiary of Carl Bennet AB, privately owned by the well-known Swedish industrialist Carl Bennet. For further information visit: www.lifco.se. About Oriola-KD Corporation Oriola-KD Corporation is a leading company in pharmaceutical distribution and trade as well as in healthcare and dental trade with business operations in Finland, Sweden, Denmark and Baltic Countries. Invoicing in 2006 was EUR 2.3 billion and the number of personnel is 1.500. Oriola-KD is listed on the Helsinki Stock Exchange. For further information visit: www.oriola-kd.com. Oriola-KD Corporation Eero Hautaniemi President and CEO Kimmo Virtanen CFO Further information: Eero Hautaniemi President and CEO Tel. +358 10 429 2109 Email: eero.hautaniemi@oriola-kd.com Pellervo Hämäläinen Vice President, Communications and IR Tel. +358 10 429 2497 Email: pellervo.hamalainen@oriola-kd.com Distribution: Helsinki Exchanges Main media Oriola-KD Corporation Corporate Communications Orionintie 5 FI-02200 Espoo, Finland www.oriola-kd.com
Oriola-KD and Lifco to create a new market leader in dental wholesale business
| Source: Oriola-KD Oyj