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Cardinal Health, Henry Schein Ink Long-Term Deal To Serve Physician Offices

Healthcare services company Cardinal Health, Inc. (CAH) and Henry Schein, Inc. (HSIC) have signed a long-term strategic agreement to provide one of the most comprehensive service and product offerings to office-based medical practices. This deal combines Cardinal Health's product line and extensive touch points across the health system with Henry Schein's outstanding service capabilities and history in serving office-based practices.

Pursuant to the agreement, the physician office-focused commercial organization of Cardinal Health's Medical unit would be consolidated into the commercial organization of Henry Schein's Medical Group. Henry Schein has committed to buy Cardinal Health Brand products and utilize Cardinal Health as a primary source for various medical products. The transaction is expected to be slightly accretive to both the companies' respective earnings per share in fiscal 2015 and increasingly accretive thereafter.

The physician office sales team and physician office distribution business of Cardinal Health's Medical segment, with annual sales exceeding $300 million, would be transitioned into Henry Schein's Medical Group. Cardinal Health would transition to Henry Schein the servicing of the medical product needs of over 25,000 physician office customer locations and nearly 200 employees.

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