Deltex Medical Regulatory News (DEMG)

Deltex Medical Group plc

Placing of 3,684,211 New Ordinary Shares at 28.5 pence to raise approximately £1million

15 April 2011 - Deltex Medical Group plc ("Deltex Medical" or the "Company"), the global leader in oesophageal Doppler monitoring ("ODM"), announces that Arden Partners plc has on behalf of the Company, placed 3,684,211 new ordinary shares of 1 pence each ("New Ordinary Shares") at a price of 28.5 pence, to raise approximately £1 million after expenses (the "Placing").

The Company, which was cash positive at the operating level in the second half of 2010, will use the proceeds to strengthen its balance sheet following the National Institute for Health and Clinical Excellence (NICE) recommendation that the NHS in the UK adopt CardioQ-ODM™ in major and high risk surgery. The Directors expect that the NICE recommendation will stimulate sales growth and the Company is therefore taking this opportunity to raise further working capital in anticipation of this expected increase in demand.

The Company estimates that at 31 December 2010 a CardioQ-ODM monitor was installed in approximately one-fifth of the NHS operating theatres used routinely for major and high risk surgery in England: in the year ended 31 December 2010 these monitors were used to treat approximately 3% of the 837,000 surgical patients identified by NICE.

Placing details

Arden Partners plc has placed 3,684,211 New Ordinary Shares on behalf of the Company with institutional investors. The Placing is conditional, inter alia, upon Admission and will raise approximately £1 million, after expenses.

Application will be made for the New Ordinary Shares issued pursuant to the Placing to be admitted to trading on AIM and it is anticipated that Admission will become effective and that dealings will commence on 21 April 2011.

The Placing Shares will, when issued, rank equally in all respects with the existing ordinary shares and will represent approximately 2.68 per cent. of the entire issued share capital of the Company immediately following Admission.

Following the Placing the Company will have 137,341,788 ordinary shares in issue. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in Deltex Medical Group plc, under the Disclosure and Transparency Rules.

Publication of Report and Accounts and AGM

The Company posted its Report and Accounts for the year ended 31 December 2010 on 4 April 2011 together with the Notice of AGM which is to be held on 28 April 2011. A Chairman's statement will be issued at the AGM of the Company.

Deltex Medical's chairman, Nigel Keen, commented:

"The additional funds raised give the Company additional working capital to help NHS hospitals accelerate implementation of NICE's guidance, initially by allowing us to increase inventory levels of both CardioQ-ODM monitors and single patient disposable probes."

For further information, please contact:-

Deltex Medical Group plc 01243 774 837

Nigel Keen, Chairman njk@deltexmedical.com

Ewan Phillips, Chief Executive eap@deltexmedical.com

Paul Mitchell, Finance Director pjm@deltexmedical.com

Nominated Adviser & Broker

Arden Partners plc 020 7614 5900

Chris Hardie chris.hardie@arden-partners.com

Jamie Cameron jamie.cameron@arden-partners.com

Kreab Gavin Anderson 020 7074 1800

Robert Speed rspeed@kreabgavinanderson.com

Deborah Walter dwalter@kreabgavinanderson.com

This announcement is for information purposes only and does not constitute an offer to sell or an invitation to subscribe for or a solicitation of an offer to buy or subscribe for any securities in any jurisdiction including in which such an offer or solicitation is unlawful and is not for distribution in or into, without limitation, the United Kingdom, the United States, Canada, Australia or Japan (the "Excluded Territories"), or to US persons (within the meaning of Regulation S of the United States Securities Act 1933 (as amended) (the "Securities Act").

The New Ordinary Shares have not been and will not be registered under the Securities Act or under the applicable securities laws of any state in the United States or any Excluded Territory and, unless an exemption under such act or laws is available may not be offered for sale or subscription or sold or subscribed directly or indirectly within the Excluded Territories or for the account or benefit of any national, resident or citizen of the Excluded Territories. No public offering of securities will be made in the United States. The distribution of this announcement in other jurisdictions may be restricted by law and therefore persons into whose possession this announcement comes should inform themselves about and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions.

Arden Partners plc, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Deltex Medical and for no one else in connection with the Placing and will not be responsible to anyone other than Deltex Medical for providing the protections afforded to clients of Arden Partners plc nor for providing advice in relation to the Placing or any other matters referred to in this announcement.

This announcement contains certain statements that are or may be "forward-looking statements". These statements typically contain words such as "intends", "expects", "anticipates", "estimates" and words of similar import. All the statements other than statements of historical facts included in this announcement, including, without limitation, those regarding Deltex Medical's financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to Deltex Medical's products and services) are forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and therefore undue reliance should not be placed on such forward-looking statements. There are a number of factors that could cause the actual results, performance or achievements of Deltex Medical or those markets and economies to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding Deltex Medical's present and future business strategies and the environment in which Deltex Medical will operate in the future and such assumptions may or may not prove to be correct. Forward-looking statements speak only as at the date they are made. Neither Deltex Medical, nor Arden Partners plc nor any other person undertakes any obligation (other than, in the case of Deltex Medical, pursuant to the AIM Rules for Companies) to update publicly any of the information contained in this announcement, including any forward-looking statements, in the light of new information, change in circumstances or future events.

Notes for Editors

Deltex Medical manufactures and markets the CardioQ-ODMÔ system. CardioQ-ODM changes the way doctors care for surgical patients allowing them to recover faster and leave hospital sooner and in better health than they otherwise would do. The performance of the system has been validated through independently conducted, randomised controlled clinical trials and is being translated into routine clinical practice in leading hospitals around the world.

CardioQ-ODM comprises a monitor and a single patient disposable probe. The probe is placed into the oesophagus through either the mouth or nose and the tip positioned facing the adjacent descending aorta. A low frequency ultrasound signal, generated by the monitor, is bounced off the blood travelling down the aorta and the Doppler principle is used to determine the velocity of the blood flow, expressed in distance per cardiac cycle - 'Stroke Distance'. The monitor also calculates the amount of time that blood is flowing down the aorta as a proportion of a cardiac cycle - 'Flow Time'.

The monitor uses a validated proprietary nomogram to extrapolate volumetric data (Stroke Volume, Cardiac Output etc) from the directly measured flow velocity. The nomogram utilises the patient's age weight and height, effectively to estimate the size of the aorta in which the velocity of the flow is being measured. Crucially this means that any reported relative change in Stroke Volume is absolutely identical to the relative change in the directly measured flow velocity variable of Stroke Distance. CardioQ-ODM immediately and reliably identifies even very small changes in the blood flow velocity allowing doctors to intevene earlier and on smaller changes than with any other approach.

Intra-operative individualised Doppler guided fluid management entails insertion and focusing of the probe to obtain a baseline reading, giving a small (200 to 250 ml) fluid challenge directly into the vascular system and seeing if Stroke Volume (or Stroke Distance) increases by more than 10%. If the increase is more than 10%, repeat fluid boluses are administered until such time as the increase is less than 10%: after this no further fluid is given unless Stroke Volume falls by more than 10% - the process is designed to achieve and maintain the individual patient's optimal Stroke Volume. CardioQ-ODM is also used during surgery to guide administration of vaso-active agents such as inotropes.

The CardioQ-ODM helps patients by enabling doctors to reduce the complications that arise from a medical condition that is common to almost all patients having surgery and many others in intensive care or arriving in the accident and emergency department. This condition is known as hypovolaemia - a reduction in circulating blood volume - and in surgical patients arises as a direct consequence of the combined effects of pre-operative starvation, the anaesthetic agents and the blood and fluid losses associated with the surgical procedure itself. Hypovolaemia means that the body struggles to get sufficient blood to the tissues and vital organs which are consequently starved of essential oxygen. This can cause medical complications including peripheral and major organ failure, which if not dealt with quickly can lead to severe compromise or even death.

There are already over 2,300 CardioQ-ODMs currently in use in hospitals worldwide and distribution arrangements are in place in over 30 countries. In addition, there are currently more than 250 clinical publications on the use of the CardioQ-ODM which have repeatedly:-

·; Validated the results of CardioQ-ODM against known standards for measuring cardiac output

·; Proved that CardioQ-ODM works in a wide range of surgical procedures

·; Proved that CardioQ-ODM delivers 50% or more reductions in post-operative complications and 25% or more reductions in length of hospital stay: better care at lower cost.

The SupraQÔ is an entirely non-invasive device which uses an ultrasound probe held at the base of the patient's neck to track the flow of blood in the aorta; it presents the same data as the CardioQ-ODM in a similar format and is used for taking snapshots or monitoring over short periods.