Oriola-KD and Lifco to create a new market leader in dental wholesale
business
7.6.2007
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