Sulzer shareholders have participated directly in Sulzer’s industrial activities as well as indirectly in Sulzer Medica. As a result of the spin-off, Sulzer shareholders will receive two Sulzer Medica shares for each Sulzer share that they own at the time of the spin-off. In light of the importance of this event the Board of Directors has sent to Sulzer shareholders a second information brochure setting out the importance, structure and mechanics of the spin-off.

The spin-off will enhance the two companies’ operational and financial transparency and will provide the management teams with increased strategic flexibility. In addition Sulzer Medica will benefit from an increased free float of nearly 100%. The spin-off will result in current shareholders being provided with additional flexibility in making their investment decisions in two pure-play companies.

With its strong competitive position as a focussed industrial company, Sulzer is committed to delivering shareholder value through growth and improving profitability.

Update on the inclusion in the SMI
After initial discussions with representatives of the Swiss Stock Exchange and after consultation of the Index Rules, it can be assumed that, based on the current situation, Sulzer will continue to qualify for inclusion in the SMI after the spin-off and Sulzer Medica will initially not be newly admitted to the SMI. The Index Commission reviews its decisions periodically.

Important information on Sulzer Medica
On June 18 Sulzer Medica Ltd. announced the filing of its 20-F (special SEC annual report), which includes references to risk factors related to its business. This is an important document for Sulzer shareholders, who will in due course become direct Sulzer Medica shareholders, as it provides an update on the voluntary recall by Sulzer Orthopedics Inc. of the Inter-Op hip joints and the scientific investigation of the tibial baseplates produced from July to December 2000.

The 20-F of Sulzer Medica Ltd. is available at www.sulzermedica.com or may be ordered free of charge from Sulzer Medica Ltd. (tel. +41 52-262 53 36; fax +41 52-262 03 93;
e-mail: dagmar.lambert@sulzer.com).

THE SAFE HARBOR STATEMENTS UNDER THE U.S. PRIVATE SECURITIES LITIGATION REFORM ACT 1995

This report contains forward-looking statements including, but not limited to, projections of future performance of materials and products, financial conditions, results of operations and cash flows, containing risks and uncertainties. These statements are subject to change based on known risks detailed from time to time in the Company’s Securities and Exchange Commission filings and other known and unknown risks and various other factors which could cause the actual results or performance to differ materially from the statements made herein.