DENTSPLY International Completes the Acquisition of Degussa Dental; Creates a Global Powerhouse in the Professional Dental Products Industry.

Business Editors

YORK, Pa.--(BUSINESS WIRE)--Oct. 2, 2001

DENTSPLY International Inc. (NASDAQ: XRAY) and Degussa Dental, a unit of Degussa AG, (Frankfurt: DGX) announced today the completion of the acquisition of Degussa Dental by DENTSPLY.

DENTSPLY has acquired the worldwide Degussa Dental business in a cash transaction valued at approximately Euros 576 million (approximately U.S. $530 million). The total value of the acquisition including anticipated fourth quarter restructuring costs and other costs associated with the acquisition is approximately $555 million.

The transaction combines DENTSPLY International, the world's largest manufacturer of professional dental products, with Degussa Dental, the second- largest dental company worldwide and the market leader in Germany and Europe, and the only significant non-domestic dental company in the Japanese market.

This combination creates a professional dental products company, more than three times the size of its nearest competitor.

Acquisition's Strategic Highlights:

-- Offers substantial growth and synergies

-- Increases scale worldwide including the three largest dental markets: U.S.,
Europe and Japan

-- Broadens extensive consumable and laboratory product lines to include key
precious metal dental alloys and CAD/CAM ceramics

-- Provides exceptional opportunity to increase penetration in the Japanese
market

-- Expands established leading brand names

-- Adds leading technology platform for the production of high-growth, high-
margin ceramic products

-- Provides significant sales force expansion

-- Enhances strong R&D platform

-- Adds strong management team.

Degussa Dental is expected to add approximately $430 million to DENTSPLY's annual sales. The combined company is expected to generate total revenues in excess of $1.5 billion in calendar 2001, with EBITDA in excess of $250 million.

While the transaction is dilutive by approximately $0.04 per share for the balance of the current year, it is expected to be $0.08 to $0.10 accretive to earnings per share on a reported basis in calendar 2002 and accretive by $0.25 to $0.30 to reported earnings per share in 2003.

On a cash earnings basis accretion is expected to be approximately $0.30 to $0.35 per share in 2002 and $0.45 to $0.55 per share in 2003.

John C. Miles II, Chairman and Chief Executive Officer of DENTSPLY, stated, "We are very excited with the sales opportunities, business synergies and the management and employee strength Degussa Dental brings to us. The finalization of this transaction has taken a little longer than we initially expected, due to summer holiday schedules and timing of the German Cartel approval. However, during this period, we have been busily working to develop a solid integration plan, which should ensure a timely and effective implementation. Throughout these integration discussions and planning sessions, we have become even more convinced of the opportunities this acquisition brings to all of our stakeholders including customers, employees and investors. We are confident that you will share in our excitement in the months and years ahead."

"Degussa Dental's key product categories, most notably, precious metal dental alloys and ceramics, further enhance DENTSPLY's worldwide leadership in dental consumables and laboratory products. Degussa Dental is the leading supplier worldwide for precious metal dental alloys, an estimated $1 billion market business where DENTSPLY does not have a product offering. Degussa Dental's growth strategy has been to capitalize on the accelerating trend towards highly aesthetic ceramics through its proprietary application of CAD/CAM techniques. Its proprietary products, Cicero and Cercon, add true technology leadership in the production of ceramic products and address an estimated $180 million market that is expected to grow between 15% to 20% annually," continued Mr. Miles.

"Our combination with Degussa Dental also strengthens our presence in Europe and Japan. Degussa Dental holds the number-one position in Europe, and also importantly, is the market leader in Germany, which represents over 40% of the European market. In Japan, Degussa is the third-largest dental company, providing us with an exceptional opportunity to increase share in this large, untapped market, which has historically been very difficult to penetrate," added Mr. Miles.

DENTSPLY has initially financed this acquisition with a bridge financing along with its revolving credit facility. The Company anticipates going to the Eurobond market by the end of October with a planned 500 million Euro offering. DENTSPLY is also anticipating the completion of a sale/leaseback transaction for the precious metals being acquired of approximately $100 million during October.

DENTSPLY manufactures a broad range of products in two key categories: Dental Consumable and Laboratory Products and Dental Equipment. The Company is the number one or two-market leader in most product categories in which it competes.

DENTSPLY is committed to the development of innovative, high quality, cost-effective new products for the dental market. The Company distributes its dental products in over 120 countries under some of the most well established brand names in the industry.

Degussa Dental was a subsidiary of Degussa AG, the worldwide leading specialty-chemicals company and a subsidiary of the E.ON Group. Degussa Dental is a global provider of dental materials to the professional dental products industry. Headquartered in Hanau-Wolfgang, Germany since 1992, Degussa Dental has modern production facilities throughout the world.

Credit Suisse First Boston acted as financial advisor to DENTSPLY International for this acquisition.

This press release contains forward-looking statements regarding future events or the future financial performance of the combined company.

Actual events or results may differ materially from those in the projections or other forward-looking statements set forth herein as a result of certain risk factors, including, without limitation, the difficulty of successfully combining the operations of Degussa with those of DENTSPLY in a timely manner, the ability to continue to generate sufficient cash flow to pay down the additional debt as planned, the potential loss of key employees as a result of uncertainty caused by the acquisition, the failure to achieve the costs savings, revenue growth or synergies expected to be realized as a result of the acquisition, the significant increase in DENTSPLY's debt-to-capitalization ratio as a result of the acquisition and the diversion of resources to debt service rather than for investment in DENTSPLY's existing businesses.

For an additional description of risk factors, please refer to the Company's Form 10-K filing with the Securities and Exchange Commission.