Acquisition

RNS Number:2696N
Medical Solutions PLC
08 July 2003



For Immediate Release:                               07:00, Tuesday 8 July 2003

                             Medical Solutions plc

                     UK Entry Into Private Pathology Arena

  Medical Solutions Acquires Established London-Based Histopathology Business

Nottingham, UK: Medical Solutions plc ("the Company"), the cancer and pathology
services group, today announces that it has agreed to acquire Farrer-Brown
Histopathology ("Farrer-Brown") a leading private histopathology laboratory in
London. Farrer-Brown, based in Harley Street, London, UK, is an established
clinical histopathology service provider.

This acquisition follows an announcement made earlier today by Sonic Healthcare
("Sonic") (ASX:SHL), Australia's leading pathology reference laboratory that it
has completed its own acquisition of MIA Group Limited's UK Pathology operation,
Omnilabs Limited. Medical Solutions has acquired Farrer-Brown, the Omnilabs'
histopathology business from Sonic in a back-to-back agreement for #450,000 in
cash.

As part of the transaction, Medical Solutions has established two joint ventures
with Sonic, one to supply histopathology services and the other for cytology
services.

Medical Solutions will manage and own 75% of the histopathology joint venture
supplying services to public health customers within the M25 area, and private
healthcare customers throughout the UK. Medical Solutions will bring access to
its current network of over 60 consultant histopathologists.

The second joint venture will be managed by The Doctors Laboratory ("TDL"), the
UK subsidiary of Sonic, which will provide cytology services to the private
healthcare sector across the whole of the UK and to the public healthcare market
within the M25 area. Medical Solutions will own 25% of this company. TDL have
the largest private liquid based cytology service in the UK and Medical
Solutions will continue to supply SurePath Liquid Based Cytology equipment and
consumables throughout the UK.

Omnilabs' histopathology turnover for the eleven months to 31 May 2003 was
#0.42m with an operating loss of approximately #0.04m. The Company is acquiring
net assets with a value of approximately #0.38m. The business employs 8 staff
including two full-time histopathologists.

Charles Green, Chief Executive Officer of Medical Solutions, commenting on the
acquisition, said:

"Having established a strong presence in the provision of cancer pathology
services to the UK public market (the NHS) and more recently in the Middle East,
through our successful Dubai acquisition, it is our belief that this most recent
acquisition provides Medical Solutions with the potential for rapid expansion
into the increasing UK private sector.

This acquisition is an important piece of our long-term strategy and provides us
with a strong first foothold into the very attractive private pathology market.
The acquisition also provides Medical Solutions with a CPA accredited laboratory
facility in the heart of London.

I am delighted that we have formed the relationship with Sonic who are one of
the leading providers of medical diagnostics in the world with a particular
expertise in pathology services."

                                    - ENDS -

For further information, please contact:

Medical Solutions
Charles Green, Chief Executive Officer                     Mobile: [phone]
Andy Longstaffe, Finance Director                          Mobile: [phone]


Buchanan Communications                                 Tel: [phone]
Nicola How / James Strong


Notes to Editors:

Medical Solutions plc provides world leading services and technology for cancer
diagnosis and pathology, supporting the Healthcare, Pharmaceutical and
Biotechnology sectors.

As previously reported, the Group's principal focus over the last 18 months has
been on building a substantial cancer diagnostics and pathology business capable
of servicing its public, private and commercial domestic markets. Due to the
substantial progress made in establishing the Group's services in the UK, the
Directors believe that the Group is now well positioned to exploit the
opportunities that it's offering provides in overseas markets, and private
markets.

The group's strategy can be summarized as follows:

   *To cross sell its range of services throughout it's private, public and
    commercial customer base;

   *To expand its regional and international areas of operation both
    organically and through acquisition; and

   *To diversify further the range of services offered to its clients.

Sonic Healthcare is one of the world's largest medical diagnostics companies,
providing pathology and radiology services to medical practitioners, hospitals,
community medical services and their patients.

Sonic Healthcare was listed on the Australian Stock Exchange in 1987 and,
following reconstitution of the Board in 1992, has experienced exceptional
growth. Since 1993 its annual revenues have risen from $25 million to over $850
million.

London-based The Doctors' Laboratory Group ("TDL") is Sonic's existing UK
pathology operation and is the largest private pathology practice in the United
Kingdom.

TDL, which is based in London's "Harley Street" medical district, provides
pathology services throughout the UK. The practice has an excellent track record
with service provision to the NHS and is well placed to play a major role in the
impending restructure of the UK pathology industry.

The practice has an annual turnover in the order of #20M (A$55M) and has
achieved a compound annual growth in revenue of 25%.

In announcing the acquisition of TDL, Dr Colin Goldschmidt of Sonic said, "TDL
is an exceptional practice with a very talented management team who are keen to
partner with Sonic to drive growth in the UK and European markets. Of a number
of possible opportunities, TDL offers an exceptional opportunity for Sonic to
access new and still fragmented markets and to add value derived from Sonic's
corporate experience in Australia."

Dr. Jean Shanks, a pioneer of private pathology services in the UK, established
Omnilabs in the 1950s. In the 1990s, Dr. Shanks incorporated the histopathology
practice established by Dr. Geoffrey Farrer-Brown, long regarded as the leading
private histopathology laboratory in London.




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            The company news service from the London Stock Exchange

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