Henry Schein completes three acquisitions to advance strategic plan

Henry Schein, Inc. (NASDAQ: HSIC), has announced three acquisitions that advance key priorities of the Company's 2012-2014 strategic plan. Together these acquisitions represent annual sales of approximately $61 million and will be neutral to the Company's 2012 diluted EPS. Financial terms were not disclosed.

Henry Schein enhanced its position in the dental specialty market through the acquisition of Ortho Technology, Inc., a $24 million orthodontics business; furthered its strategy of helping medical practitioners operate more efficient and profitable practices by strengthening its U.S. physician office laboratory presence through the acquisition of Modern Laboratory Services, a $22 million medical distributor; and expanded its geographic footprint in Asia through a merger with Accord, a $15 million full-service dental dealer in Thailand, the 26th country in which Henry Schein now has operations or affiliates.

"The addition of Ortho Technology, Modern Laboratory Services and Accord furthers our strategic priority of global growth in important market segments and new geographies," said Stanley M. Bergman, Chairman and Chief Executive Officer of Henry Schein. "Each of the three companies is a leader in its respective area of focus, and each is an excellent cultural fit with an unwavering commitment to customer service. We welcome our new colleagues to Team Schein and look forward to continued success together."

Ortho Technology
Ortho Technology, Inc. is a distributor of orthodontics products primarily to orthodontists. The company is based in Tampa, Florida, was founded in 1991, has approximately 90 team members and posted 2011 sales of approximately $24 million. Ortho Technology offers a complete line of orthodontic supplies, including brackets, bands, buccal tubes, archwires, adhesives, laboratory supplies and patient accessories. The company serves more than 10,000 customers worldwide via direct sales from the U.S. and distributors across the globe.

"Specialty dental markets including orthodontics are important components of our growth strategy. In December 2008 we acquired Ortho Organizers and with this transaction we are further penetrating the $1.25 billion global orthodontics market with a company that has been gaining market share for several years," said Mr. Bergman.

"We envision multiple synergies between these two organizations, including leveraging Ortho Organizers' manufacturing of certain key products and Ortho Technology's aesthetic brackets and its best-in-class direct marketing expertise," added Mr. Bergman.

Henry Schein plans to operate Ortho Technology as a stand-alone business and to promote the company as part of the Henry Schein portfolio of orthodontic companies. Ortho Technology President Brian Leaghty will serve as a consultant for a year to ensure a smooth transition.

According to Mr. Leaghty, "Orthodontics is an exciting dental specialty characterized by product innovation and growing global demand. As part of Henry Schein, Ortho Technology has considerably enhanced business prospects and an opportunity to solidify market share gains into the future."

Modern Laboratory Services
Based in Bakersfield, California, and founded in 1984, MLS is one of the leading distributors in the Western U.S. for products and services for physician office laboratories, such as laboratory equipment and supplies. MLS represents many of the most important suppliers in the clinical laboratory business including serving as the exclusive distributor for the Siemens' Dimension® chemistry analyzer product line.

With 2011 sales of approximately $22 million, MLS serves approximately 700 customers through 36 team members. Stan Sherrill, CEO and co-owner, will join Henry Schein as the West Coast Lab Sales Manager and Bob Ward, President and co-owner, will continue to oversee MLS's business to U.S. military bases and U.S. territories.

"The acquisition of MLS reflects Henry Schein's continued commitment to physicians and the clinical laboratory market, and strengthens our position in the West Coast, which is an area of exciting growth for us," said Mr. Bergman. "This transaction advances our goal of gaining market share and adding knowledgeable management through strategic acquisitions within important business areas."
Commenting on today's announcement, Mr. Sherrill said, "By joining forces with Henry Schein, MLS will have access to the resources and capital necessary to accelerate our growth in the dynamic and highly competitive physician office laboratory market. We look forward to being a part of a Fortune 500® company with global best practices."

Accord is based in Bangkok and recorded 2011 sales of approximately $15 million. Founded in 1976, Accord has approximately 115 team members, including 45 sales representatives, and more than 5,000 customers, including private office-based dental practitioners, public and private hospitals, dental schools and public health authorities. Henry Schein has acquired 75 percent of Accord. The Charnsethikul family will retain the remaining 25 percent of the company.

"Thailand, with an estimated market size of more than $100 million, is the fifth largest dental market in Asia. In addition to establishing our presence in that important market, Accord also will serve as an anchor for further expansion into Southeast Asia, which represents an incremental $150 million market opportunity," said Mr. Bergman.

Accord was owned by the Charnsethikul family and has been operated by Mrs. Suchada Charnsethikul, who is in her second term as President of the Thai Dental Trade Association. Mrs. Suchada Charnsethikul will continue to manage Accord as Managing Director.

"Accord is widely recognized as a well-run full-service dental distribution company with solid management and an excellent product portfolio," continued Mr. Bergman. "Mrs. Suchada Charnsethikul is one of the most respected leaders in the Asian dental community, and enjoys extensive relationships with distributors in other countries and with key manufacturers. We welcome our new Thai colleagues to Team Schein and look forward to continued success together."

According to Mrs. Suchada Charnsethikul, "The reputation of Henry Schein in the global dental community is without peer, and my colleagues and I are delighted to be aligned with the industry leader. As a family-run business for more than 35 years, we fully appreciate the importance of our customers to our success. We look forward to strengthening these ties and helping our customers operate efficient and profitable business with the products, services and know-how available through Henry Schein."

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