TOKYO, November 19 /PRNewswire/ -- Olympus Corporation today formally announced that it intends to acquire all the ordinary shares of Gyrus Group PLC (LSE: GYG), a medical equipment manufacturer headquartered in the United Kingdom. In accordance with the UK Takeover Panel, Olympus and Gyrus have jointly announced the recommended cash acquisition of Gyrus by Olympus in the London market. Gyrus' board has recommended an offer of 630 pence per ordinary share, which values the existing issued share capital of Gyrus at approximately GBP935 million (Yen211.7 billion). Olympus believes that this offer is fair and reasonable and reflects the due diligence and other procedures whereby the company comprehensively assessed Gyrus' assets, operations and potential synergies. Gyrus is a leader in radio-frequency devices and energy-based technologies for minimally invasive surgical systems. The acquisition will generate strong synergies while creating a medical systems business with revenue of approximately Yen360 billion (see note 1) that solidifies Olympus' capabilities in minimally invasive products. "The operations of Gyrus' and Olympus' medical systems are highly complementary. I am confident that this planned partnership will generate significant synergies and opportunities for both firms. The combination of technological capabilities will further enhance product systems, which I expect will enable surgeons and their staffs to ultimately perform safer and more effective surgical procedures with better patient outcomes," commented Tsuyoshi Kikukawa, President of Olympus. 1. Background The global medical equipment market continues to expand, particularly for minimally invasive systems that reduce pain and discomfort from surgery, due to aging populations in Japan and other advanced nations and improving standards of medical care are in developing countries. These systems offer cost benefits for providers and patients and could play a significant role in limiting medical costs. In May 2006, Olympus launched a corporate strategic plan to optimize corporate value. One goal of this three-year initiative is to build a platform for even higher growth and earnings from the company's Medical Systems Business. Olympus aims to draw on Gyrus' capabilities to accelerate development and commercialization of energy-based technology equipment. Olympus believes an expanded position in medical systems will enable the company to reinforce its reputation for highly reliable and efficient patient care technologies. 2. Key Benefits (1) Significant synergies The transaction will create significant synergies that will assist Olympus to broaden its lineup in order to meet growing demand for minimally invasive medical systems as well as contribute to patient wellbeing. (2) Global sales network expansion Olympus expects to expand its worldwide marketing network, particularly in urological and gynecological systems, in which Gyrus has an established presence in the U.S. market. (3) Share best practices & realize synergies Both companies would work together to share best practices developed independently. Olympus and Gyrus plan to achieve synergies in areas such as sales channels and procurement that would help to enhance revenue and profitability. 3. Transaction Process The transaction will be in the form of a scheme of arrangement under U.K. law. This is a common procedure for completing friendly acquisitions that is subject to board consent, clearance from competition authorities, approval at a general meeting of shareholders and judicial consent. For the transaction to be completed, a shareholder resolution would be required to be approved by a majority in number of those shareholders present and voting who represent at least 75% in value of the votes cast at that meeting. Olympus UK Acquisitions Limited, a new wholly owned acquisition subsidiary of Olympus, would acquire 100% of the ordinary shares of Gyrus. The transaction is expected to close by the Scheme becoming effective in the first half of 2008. 4. Purchase Funding Olympus would fund the acquisition through a combination of its existing cash holdings and a new debt facility. 5. Impact on Business Results Olympus will disclose in a timely manner details of the impact of this transaction on its consolidated and nonconsolidated operating results for its current fiscal year ending March 31, 2008. FORWARD-LOOKING STATEMENTS This announcement, including information included or incorporated by reference in this announcement, may contain "forward-looking statements" concerning Olympus and Gyrus. Generally, the words "will", "may", "should", "continue", "believes", "expects", "intends", "anticipates" or similar expressions identify forward-looking statements. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the companies' abilities to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements. Olympus and Gyrus assume no obligation and do not intend to update these forward-looking statements, except as required pursuant to applicable law. Gyrus Group Profile NAME: Gyrus Group PLC Location: Berkshire, United Kingdom Establishment: 1989 Listing: Listed on London Stock Exchange in 1997 Year-end: December 31 Paid-in capital: GBP2,792 thousand (as of December 31, 2006) Issued and outstanding shares: 148,470,051 million (November 16, 2007) Consolidated net sales GBP213,342 thousand (year to 31 December 2006) Consolidated total assets: GBP460,622 thousand (as of December 31, 2006) Senior management team: Chairman: Brian Steer Chief Executive Officer: Roy Davis Other directors: 7 (for a total of 9) Employees: 1,434 (average for year to 31 December 2006) Recent Consolidated Operating Results Year to 31 December Year to 31 December 2005 2006 Revenue GBP150,376 thousand GBP213,342 thousand Operating profit GBP10,418 thousand GBP19,145 thousand Profit for the year GBP6,276 thousand GBP13,193 thousand Total assets GBP516,288 thousand GBP460,622 thousand Net assets GBP301,505 thousand GBP286,833 thousand Olympus' mission is to create new value in the medical, imaging, life science and industrial fields with its core competence "Opto-digital Technology" as the driving force. As a global company with a network of operations throughout the world, Olympus continually pursues innovation to maximize value for all stakeholders. FOR US media inquiries: Thomas Smith Senior Vice President Ogilvy Public Relations Worldwide Office: +1-212-880-5269 FOR Japan media inquiries: Kenichi Yano General Manager Public Relations and Investor Relations Olympus Corporation Office: +81-(0)3-3340-2111 (1) Note: The data is a simple combination of the business results for Olympus in the year ended March 31, 2007, and for Gyrus in the year ended December 31, 2006, without adjustments for different accounting standards in Japan and the United Kingdom. The materials in this document use an exchange rate of GBP1 = Yen226.32 (as of November 16, 2007).