GN Danavox and ReSound merge to form GNResound

REDWOOD CITY, CALIFORNIA--The combination of GN Danavox, a GN Great Nordic subsidiary, and ReSound became effective on July 6, 1999, following the successful completion of a tender offer by GN Great Nordic.

The combined company, called GN ReSound, is now the fourth largest hearing device manufacturer in the world, with an estimated 14 percent worldwide market share. The company will have annual revenue in excess of $200 million (U.S.) and is headquartered in Redwood City, California.

'ReSound and GN Danavox are an excellent strategic fit. Our combined ability to offer truly meaningful solutions to our end users to improve not only hearing but human interaction is strengthened considerably. We believe the combined companies will gain significant advantages together: stronger and broader distribution channels in all major worldwide markets, a more robust manufacturing capability, and an increased, more solid product development pipeline,' said Russell Hays, president and chief executive officer.

GN ReSound will have sales and marketing organizations in 16 countries and distribution in over 70 others. Production will take place in the United States, Ireland, Denmark, Austria and China. In addition, there are facilities for custom asembly of in-the-ear devices in several other countries.

Jesper Mailind, executive vice president and chief operating officer added, 'GN ReSound will have the critical mass necessary to bring a complete offering of advanced, high-technology products to audiologists, dispensers and end-users worldwide. In addition, we will be able to make the critical research and development investments needed to achieve continuous product innovation. Through the integration process over the next several months, we plan to fuse the best of both GN Danavox and ReSound to create a significant leader in the hearing health care industry that offers GN ReSound customers the very best products and exceptional product support.'

Following a transition period, Jesper Mailind, former president and chief executive officer of GN Danavox, will succeed Hays as president and chief executive officer of the combined company.

GN ReSound will have sole ownership of the digital technology developed through an alliance between GN Danavox and ReSound--previously market competitors--and AudioLogic, a United-States-based technology developement firm. In 1998, GN Danavox and ReSound each introduced a new portfolio of digital hearing devices, under the brand names Danalogic and Digital 5000, respectively. These products incorporate the advanced software-based technology developed in the alliance with AudioLogic. These industry-leading devices provide significantly more computational power than other digital products to allow extensive customization to address individual patient needs. Furthermore, it permits advancements derived from future research to be implemented more rapidly for use by hearing professionals and their patient.

Among the capabilities of GN ReSound's digital product portfolio are: active, 'search and destroy' feedback cancellation; 14-band (FFT-based) wide dynamic range compression (WDRC) with overlapping bands to eliminate distortion; 14-band noise reduction; and digitized two-microphone directional amplification.

GN ReSound's product portfolio includes a broad range of GN Danavox and ReSound hearing devices. All products will continue to be sold and serviced through the established channels under the GN Danavox and ReSound brand names. In addition, GN ReSound offers leading integrated computer-based audiological measuring equipment through its Madsen division.