Acquisition

Smith & Nephew Plc
12 March 2007

Smith & Nephew buys major European orthopaedic business



12 March 2007



Smith & Nephew plc (LSE: SN, NYSE: SNN), the global medical technology business,
announced today that it has agreed the purchase of Plus Orthopedics Holding AG
('Plus') a private Swiss orthopaedic company for a total of CHF* 1086 million
($889 million) in cash, including assumed debt.  Plus had gross assets of CHF
436 million ($357 million) at 31 December 2006.



The acquisition of Plus has compelling strategic logic;



•         this increases Smith & Nephew's share of the global orthopaedic
reconstruction market to around 12%, taking Smith & Nephew to global number 4



•         doubles Smith & Nephew's share of the European orthopaedic
reconstruction market



•         brings a highly complementary product range



•         is highly synergistic, bringing good opportunities to leverage the
combined sales force in Europe and Asia and cost opportunities from increased
manufacturing leverage and capacity utilisation as well as better use of the
combined marketing and sales infrastructure



•         is expected to be broadly EPSA** neutral in 2007 and accretive in 2008
and beyond, and to exceed the Group's cost of capital in the third full year
following acquisition



Plus was founded in 1991 and has its origins in European designed cementless hip
systems. Plus has worked closely with European surgeons to design and develop a
wide product range of orthopaedic implants primarily hips and knees, and also
small joint and shoulder products. The product range is highly complementary to
Smith & Nephew's and includes threaded acetabular cups and revision products for
hips, hinged fixed and mobile bearing designs for knees.  Plus has manufacturing
facilities in Switzerland and China.



Plus reported revenues of CHF367m ($300m) in 2006, an increase of 16% over the
prior year, and profit before interest and tax of CHF44m ($36m), an increase of
33% over 2005.  Smith & Nephew will be financing the acquisition by bank
borrowings.



Sir Christopher O'Donnell, Chief Executive Officer of Smith & Nephew plc,
commenting on the acquisition said 'We are delighted to bring on board this
leading European orthopaedics business which we have been following for a number
of years.  The acquisition of Plus marks a step change in our European presence
and strengthens our portfolio of products.  Our orthopaedics reconstruction
business will have increased scale and scope as a result.  We welcome Plus's
employees to Smith & Nephew and we look forward to building on their
capabilities, especially in Europe and Asia.'



Robert Riedweg, Delegate of the Board and Chief Executive Officer of Plus,
commented on the transaction as follows 'During the last few months, the Board
of Directors and the Executive Board of Plus have thoroughly evaluated the
strategic options for our company.  We are convinced that a combination with
Smith & Nephew is the optimal solution for our customers and our employees. The
strong market position of Smith & Nephew will enhance the ability of Plus to
further develop and market our first class orthopaedic products. Smith & Nephew
also offers excellent prospects for our business.'



A conference call to discuss this announcement will be held at 9.30am GMT /
5.30am EST today, Monday 12 March.  This will be broadcast live on the web and
will be available on demand shortly following the close of the call at http://
www.smith-nephew.com.  A podcast will also be available at the same address.  If
interested parties are unable to connect to the web, a listen-only service is
available by calling [phone] in the UK or [phone] in the
US.  Analysts should contact Samantha Hardy on [phone] or by email
at [e-mail] for conference call details.



* Smith & Nephew reports in US Dollars and all numbers in this announcement
which originate in Swiss Francs have been converted to US Dollars at CHF 1.221:
$1.

** Earnings per share before amortisation of acquisition intangible assets and
integration costs.





Enquiries


Smith & Nephew plc
Liz Hewitt                                                     Tel:         [phone]
Group Director Corporate Affairs

Plus Orthopedics Holding AG
Simon Vischer                                                  Tel:         [phone]

Financial Dynamics for Smith & Nephew

David Yates/ Deborah Scott - London                            Tel:         [phone]
Jonathan Birt - New York                                       Tel:         [phone]







About Smith & Nephew



Smith & Nephew is a global medical technology business, specialising in
Orthopaedic Reconstruction, Orthopaedic Trauma and Clinical Therapies, Endoscopy
and Advanced Wound Management products.  Smith & Nephew is a global leader in
arthroscopy and advanced wound management and is one of the leading global
orthopaedics companies.



Smith & Nephew is dedicated to helping improve people's lives.  The Company
prides itself on the strength of its relationships with its surgeons and
professional healthcare customers, with whom its name is synonymous with high
standards of performance, innovation and trust.  The Company has 8,800 employees
and operates in 33 countries around the world generating annual sales
approaching $2.8 billion.



Forward-Looking Statements



This press release contains certain 'forward-looking statements' within the
meaning of the US Private Securities Litigation Reform Act of 1995.  In
particular, statements regarding expected revenue growth and trading margins
discussed under 'Outlook' are forward-looking statements as are discussions of
our product pipeline.  These statements, as well as the phrases 'aim', 'plan',
'intend', 'anticipate', 'well-placed', 'believe', 'estimate', 'expect',
'target', 'consider' and similar expressions, are generally intended to identify
forward-looking statements.  Such forward-looking statements involve known and
unknown risks, uncertainties and other important factors (including, but not
limited to, the outcome of litigation, claims and regulatory approvals) that
could cause the actual results, performance or achievements of Smith & Nephew,
or industry results, to differ materially from any future results, performance
or achievements expressed or implied by such forward-looking statements.  Please
refer to the documents that Smith & Nephew has filed with the U.S. Securities
and Exchange Commission under the U.S. Securities Exchange Act of 1934, as
amended, including Smith & Nephew's most recent annual report on Form 20F, for a
discussion of certain of these factors.



All forward-looking statements in this press release are based on information
available to Smith & Nephew as of the date hereof.  All written or oral
forward-looking statements attributable to Smith & Nephew or any person acting
on behalf of Smith & Nephew are expressly qualified in their entirety by the
foregoing.  Smith & Nephew does not undertake any obligation to update or revise
any forward-looking statement contained herein to reflect any change in Smith &
Nephew's expectation with regard thereto or any change in events, conditions or
circumstances on which any such statement is based.


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