GN ReSound Dedicates New Facility

photoThe new GN ReSound and GN Otometrics facility in Bloomington, MN, was officially opened by Minneapolis/Bloomington dignitaries (l to r) Ron Marien and Louise Dickmeyer, Bloomington Mayor Gene Winstead, and GN ReSound’s President Carsten Trads, VP of Marketing Henrik Nielsen (a chief coordinator of the new facility), President & CEO (Worldwide) Jesper Mailind and President (Group North America) Alan Dozier.

Bloomington, MN — The new U.S. corporate headquarters of GN ReSound gives the illusion of an office without walls. One enters the building through a hallway that connects to an atrium containing trees, tables and chairs. The atrium is surrounded by the glass-walled offices and doors of the company’s corporate executives. Looking through and beyond their offices, one can see the open office area of the administrative staff located in a vast, modern sunlit room. Looking farther, one can see—through a third glass wall—the equally sunlit production facilities where the company’s hearing instrument assembly takes place.

photoTrads, HIA President Carole Rogin, Hearing Components President Robert Oliveira, HIA Legal Counsel Russell Bennett and Dozier enjoy the event.

The new GN ReSound and GN Otometrics facilities are the culmination of many years of hard work, according to Alan Dozier, president of GN ReSound Group North America. “If you look around this building,” says Dozier, “you will see that it is all about teamwork and linking people with the customer base…We want GN ReSound’s light to shine brightly.”

Company President Carsten Trads noted that the architecture of the facility is symbolic of the company’s renewed commitment to its customers: “We’re coming out of a situation where administration and manufacturing were separated by a half-hour drive. This is not about a building that has a Scandinavian design and glass office walls, but it is about a creative service-driven organization with two major focuses: customer service and high technology.” Trads also described the recent launch of the company’s new Canta digital hearing instrument line and the research that the company has been conducting over the last five years.

The event featured tours of the new facility, including its manufacturing/assembly plant, administrative offices and workstations. The new headquarters employs about 400 people.

HEARx and Helix announce intent to merge companies
Montreal — Two of the three largest publicly-owned hearing practice consolidators, HEARx Ltd, West Palm Beach, FL, and Helix Hearing Care of America, Montreal, have signed a letter of intent to merge. The companies report that the merger, if approved, would result in the largest hearing care network in North America, with more than 200 centers.

The newly formed company would comprise about 4-5% of the market with annual sales of 80,000-100,000 hearing instruments, according to HR and industry analyst statistics. HEARx has approximately 80 company-owned offices with annual revenues of about $56.7 million, and Helix has about 138 offices with revenues of about $24 million (U.S.). The parties have discussed a revenue target for the combined company of more than $100 million for fiscal year 2002.

“We expect that the combined company will benefit from HEARx’s 170 health care provider contracts,” says Paul A. Brown, MD, chairman and CEO of HEARx. “We also expect that the company would benefit from Helix’s expertise in acquisitions.” Steve Forget, president and CEO of Helix says, “We believe the combined company will be in a stronger position to benefit from the investments in the Internet and network development that Helix has recently made.”

“If you look at how we’ve positioned [Helix], you will see that we’ve become a hearing benefit management company,” says Jeffrey Geigel, vice president of communications at Helix. “By being the largest chain hearing care network, the new company would establish itself as the benchmark and bellwether for the retail marketplace.” He said that one $100 million dollar company provides many more options than if the companies remain as two smaller entities competing against other and other hearing care networks (e.g., Sonus). When asked if the new company would dispense primarily Siemens products as the result of a recent distribution agreement between HEARx and Siemens (see Apr. 2001 HR, pg. 64), Geigel said that it was “far too early” to speculate.

If approved, the merger would provide Helix shareholders with 42% of the new company and HEARx shareholders with 58%. A definitive agreement is expected to be set forth later this month, and upon approval by shareholders and various entities, closing the deal would occur in the second half of 2001.

Industry sales remain flat in first quarter; digital use continues to grow
Alexandria, VA — First-quarter sales of hearing instruments were down by 0.71% (about 3000 units) compared to 2000 sales, according to statistics from the Hearing Industries Assn (HIA). The sales shortfall marks the second consecutive quarter in which hearing instrument sales have declined, and the industry has not experienced a 2% quarterly increase in sales for more than a year.

Digital signal instruments continue to make gains in market share. In the first quarter of 2001, digital aids comprised 24.5% of the market, up from 22.1% in the fourth quarter of 2000. Programmable instruments in the first quarter comprised 32.7%, about the same (32.2%) as in the fourth quarter of 2000. The use of non-programmable aids (42.8%) dropped by almost 3% during the same time period.