Össur Acquires British Orthopaedics Company Innovative Medical Products Holdings Ltd.

Ossur hf. (ICEX: OSSR), a trusted and leading global supplier of prosthetic and orthopaedic devices, announced today that it has acquired the UK orthopaedic products company Innovative Medical Products Holdings Ltd. (IMP) for a price of USD 18.5 million.  IMP is a manufacturing, sales and distribution company in the orthopaedics sector, and is the largest sales and distribution company in its field in the United Kingdom. Ossur will take over the operation of IMP as of today.
 

Commenting on the transaction, Ossur President & CEO Jón Sigurdsson stated:  "It has been our strategy to expand further into the orthopaedics market, and the acquisition of IMP Holdings is an important milestone in the expansion."

IMP's comprehensive line of orthopaedic products fits well with Ossur's current product lines.  IMP's strong market share, knowledge and experience will widen Ossur's opportunities for increased sales of orthopaedic products in Europe. 

Key benefits of the acquisition of IMP Holdings:

"	Provides Ossur with a strong sales network in the UK
"	Facilitates stepped-up development of the combined company's orthopaedics sales network in Europe
"	Is expected to deliver improved operating efficiency and other synergies

IMP Holdings, established in 1980, currently has 91 employees at four facilities in the UK.  IMP is a well-known company with a strong market position, and specialises in the design, sale and manufacture of knee, hip and spinal braces, sold under the brand name of Medistox and Technology in Motion.  The company was awarded the prestigious CBI New Product Award for one of its products last year.

For the fiscal year ending 31 December 2005, IMP is expecting sales of just over USD 14 million, a normalized EBITDA margin of approximately 20% and a gross profit margin of approximately 54%. In connection with the acquisition, Ossur expects to incur approximately USD 1 million of integration and restructuring expenses in 2006, but projects that these efforts will yield approximately USD 1 million of annual cost savings beginning in 2007.  As revealed in earlier releases, Ossur's 2005 acquisition of Royce Medical was overfinanced, and the excess funds will be utilized for the acquisition of IMP Holdings.

Further information:
Jón Sigurðsson, CEO tel. +354-664-1088