Healthcare Industry News:  Polysomnography 

Devices Mergers & Acquisitions

 News Release - September 6, 2006

Natus Medical to Acquire DELTAMED

Company Becomes a Market Leader in French and German EEG Markets

SAN CARLOS, Calif.--(HSMN NewsFeed)--Sept. 6, 2006--Natus Medical Incorporated (Nasdaq:BABY ) today announced that it has reached a definitive agreement to acquire privately held DELTAMED SA headquartered in Paris, France, and its wholly owned subsidiary, IT-Med, located near Frankfurt, Germany. The transaction is expected to close in approximately two weeks.

DELTAMED is a leading European manufacturer of medical devices used in the detection of neurological dysfunction, epilepsy, and sleep disorders through the use of electroencephalograph ("EEG") and Polysomnography ("PSG") technologies. The acquisition adds to Natus' international growth opportunities by broadening its product offerings and leveraging its distribution organization. Natus believes the acquisition will be accretive to earnings in the fourth quarter of 2006.

Natus has agreed to acquire DELTAMED for EUR 3.1 million or approximately U.S. $4.0 million. Under terms of the acquisition, Natus will retain DELTAMED's operations as well as its direct sales channels in France and Germany. DELTAMED founder Robert LeGuen will continue as Managing Director of the organization. DELTAMED currently has 37 employees, recorded revenue of EUR 4.3 million in calendar 2005 or approximately $5.3 million, and has sold more than 2,000 EEG & PSG devices since its inception.

"We believe DELTAMED's complementary products and distribution will fill a need in our EEG & PSG product portfolio internationally and give Natus a stronger European presence," stated Jim Hawkins, President and Chief Executive Officer of Natus. "DELTAMED has successfully developed a direct sales force in France and Germany, where they are a market leader in EEG sales and are recognized for producing high-quality products. We believe Natus can leverage this position by bringing DELTAMED products into new markets through our established international distribution channel."

"We are excited to be joining Natus, a company that shares our passion for quality, innovation and market leadership," commented Mr. LeGuen.

Any one-time charges associated with the acquisition were not included in the financial guidance previously provided by the Company.

About Natus Medical

Natus is a leading provider of healthcare products used for the screening, detection, treatment, monitoring and tracking of common medical ailments such as hearing impairment, neurological dysfunction, epilepsy, sleep disorders, newborn jaundice and newborn metabolic testing.

Additional information about Natus Medical can be found at

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, particularly statements regarding the expectations, beliefs, plans, intentions and strategies of Natus. These forward-looking statements include, but are not limited to, statements regarding the impact of the acquisition on the profitability of Natus and the extent of one-time charges associated with the acquisition. These statements relate to future events or Natus' future financial performance or results, and involve known and unknown risks, uncertainties and other factors that may cause actual results, levels of activity, performance, or achievements to differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements are only predictions and the actual events or results may differ materially. Natus cannot provide any assurance that its future results or the results implied by the forward-looking statements will meet expectations. Our future results could differ materially due to a number of factors, including the effects of competition, the demand for our products and services, our ability to expand our sales in international markets, our ability to maintain current sales levels in a mature domestic market, our ability to control costs, and risks associated with bringing new products to market and integrating acquired businesses. Natus disclaims any obligation to update information contained in any forward-looking statement.

More information about potential risk factors that could affect the business and financial results of Natus is included in Natus' annual report on Form 10-K for the year ended December 31, 2005, and its quarterly reports on Form 10-Q, and in other reports filed from time to time by Natus with the U.S. Securities and Exchange Commission.

Source: Natus Medical

Issuer of this News Release is solely responsible for its content.
Please address inquiries directly to the issuing company.

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