The Phonak Group is pleased to announce that it has entered into a share purchase agreement with GN Store Nord of Denmark to buy its subsidiary the ReSound Group, a global manufacturer of advanced technology hearing instruments for an aggregate consideration of DKK 15.5 billion in cash (CHF 3.3 billion and USD 2.6 billion at current exchange rates).
Key benefits of the combination are:
- Creates the first truly global hearing healthcare company with a strong global
presence and a broadly diversified customer base - Creates a portfolio of hearing instrument brands enjoying strong, long¬lasting
customer relationships all over the world - Confirms the company's commitment to leadership in innovation by having the
broadest and deepest R&D capabilities in the industry - Significant opportunity to improve the performance of ReSound Group to the level of Phonak
Overview of ReSound Group
ReSound Group is a global provider of digital hearing instruments and audiological diagnostics equipment. The company is based in Copenhagen with an extensive network of subsidiaries and dealers in 60 countries worldwide and has approximately 3,400 employees. The Hearing Instruments division benefits from a portfolio of powerful global brands (ReSound, Beltone and Interton) as well as a strong market position in the open fitting products category. The Otometrics division, a manufacturer of audiologic diagnostic equipment, enjoys a strong position globally in fitting systems and the balance disorder testing market.
Strategic fit creates a global powerhouse in hearing healthcare
This transaction fits perfectly into Phonak's strategy of innovation, multi¬brand approach and strong marketing focus. The combined Group will immediately benefit from its increased scale in the areas of purchasing, manufacturing and technological capabilities. In the mid term, when developing the next generation of hearing solutions, these benefits will become even more pronounced by further strengthening innovation capabilities and generating unique functionalities. The quality and breadth of the combined R&D capabilities is expected to be unmatched within the hearing industry.
"The combined Group will become the global hearing healthcare powerhouse with the most comprehensive portfolio of highly valued hearing brands, and strong long term customer relationships. We are very excited about the outstanding opportunity to work together with our employees, customers and suppliers to create value for all stakeholders", explains Valentin Chapero, CEO of the Phonak Group. "We will create a world class team that will deliver the best of both companies to customers around the world. They will benefit from improvements at all levels while keeping the established relationships and brands they value so much. Along with our marketing and branding capabilities we anticipate becoming the most attractive supplier to re¬sellers and end¬users alike. Being the global hearing healthcare powerhouse will help us to invest in raising public awareness on the importance of the sense of hearing."
About Phonak Group - At the pulse of innovation
The Phonak Group, headquartered near Zurich, Switzerland, specializes in the design, development, production and global distribution of technologically advanced hearing systems for adults and children. The Phonak Group is one of the leading companies in the hearing healthcare market. By combining its expertise in hearing technology with a strong distribution network, Phonak, along with its customers and business partners, contributes significantly to the quality of life of many people worldwide.
The Phonak Group comprises two manufacturers of hearing instruments - Phonak hearing systems and Unitron Hearing - as well as Phonak communication systems, the world's number one developer of wireless communication devices for hearing instruments and other wireless applications.
Sales are generated in over 70 countries, with a strong presence in the North American and the European markets. Furthermore, Phonak is concentrating on expanding its sales activities to Eastern Europe, Asia and Latin America.
The hearing systems are manufactured in Switzerland and China. R&D is coordinated between two centres in Switzerland and Canada. The Phonak Group employs a collective workforce of over 3,400 worldwide and is listed on the SWX Swiss Exchange (Symbol: PHBN).
For more information on Phonak and its products please visit www.phonak.com.
Important Information
This announcement includes "forward¬looking statements" that reflect Phonak's intentions, beliefs or current expectations and projections about the acquisition, the financing thereof, potential synergies and Phonak's future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies, opportunities and the industry in which it operations. Forward¬looking statements involve all matters that are not historical fact, including statements about anticipated synergy benefits from the proposed acquisition. These forward looking statements are made on the basis of assumptions and expectations which, although Phonak believes them to be reasonable at this time, may prove to be erroneous. These statements are also subject to risk and uncertainties that could cause Phonak's actual results of operations, financial condition, liquidity, performance, prospects or opportunities, as well as those of the markets it serves or intends to serve, to differ materially from those expressed in, or suggested by, these forward¬looking statements. Important factors that could cause those differences include, but are not limited to, delays in integrating the operations of the Resound Group, limitations or conditions imposed on Phonak in connection with seeking consent from regulators to the completion of the acquisition, changing business or other market conditions, general economic conditions in Switzerland, the European Union, the United States and elsewhere, and Phonak's ability to respond to trends in the healthcare industry. There may be additional factors cause actual results, performance or achievements to differ materially from expectations, including those related to the Resound Group business. Except as required by law or regulation, each of Phonak, the Resound Group management, GN Store Nord A/S and such persons' affiliates, employees and advisers expressly disclaim any obligation or undertaking to release any update or revisions to any forward¬looking statements in this announcement or otherwise communicated.
