FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20459

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934

February 18, 2004

Amersham plc

(Translation of registrant’s name into English)

Amersham Place
Little Chalfont
Buckinghamshire HP7 9NA
England

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F X Form 40-F

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rules 12g3-2(b) under the Securities Exchange Act of 1934.

Yes No X

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rules 12g3-2(b): 82- ......................

TABLE OF CONTENTS


SIGNATURE
TABLE OF CONTENTS
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
PART 1 LETTER FROM THE CHAIRMAN OF AMERSHAM
PART 2 EXPLANATORY STATEMENT
PART 3 CONDITIONS TO THE SCHEME AND THE ACQUISITION
PART 4 FINANCIAL INFORMATION ON THE AMERSHAM GROUP
PART 5 INFORMATION ON THE GE GROUP
PART 6 INFORMATION ON THE GE SHARES
PART 7 ADDITIONAL INFORMATION
PART 8 DEFINITIONS
PART 9 THE SCHEME OF ARRANGEMENT
PART 10 NOTICE OF COURT MEETING
PART 11 NOTICE OF EXTRAORDINARY GENERAL MEETING

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorised.


		AMERSHAM PLC
		(Registrant)

DATE: February 18, 2004		By..........................................
		Name: Susan M. Henderson
		Title: Deputy Company Secretary

List of exhibits to the FORM 6-K dated February 18, 2004

1. Scheme of Arrangement

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you are recommended to seek your own personal financial advice immediately from your stockbroker, bank manager, solicitor, accountant or independent financial adviser who, if you are taking advice in the United Kingdom, is authorised pursuant to the Financial Services and Markets Act 2000 or from an appropriately authorised independent financial adviser if you are taking advice in a territory outside the United Kingdom.

If you have sold or otherwise transferred all of your Amersham Shares, or entitlements thereto through the VPS in Norway or Amersham ADSs, please send this document together with the accompanying documents at once to the purchaser or transferee, or to the bank, stockbroker or other agent through whom the sale or transfer was effected. If you have sold or transferred part of your registered holding of Amersham Shares, or entitlements thereto through the VPS in Norway or Amersham ADSs, please consult the bank, stockbroker or other agent through whom the sale or transfer was effected.

This document should be read in conjunction with the accompanying documents, including the separate letter from the Chairman of Amersham, the blue and pink Forms of Proxy and the yellow Form of Election (if you are an Amersham Shareholder), the green VPS Voting Instruction Card and Norwegian language summary of some of the key information contained in this document (if you hold an entitlement to Amersham Shares through the VPS in Norway) and the white ADS Voting Instruction Card (if you are a registered holder of Amersham ADSs).

Recommended share exchange acquisition

General Electric Company and

GE Investments, Inc.

Amersham plc

by means of a

Scheme of Arrangement

under section 425 of the Companies Act 1985

A letter from the Chairman of Amersham, including a recommendation to vote in favour of the resolutions to be proposed at the Court Meeting and at the Amersham EGM, is set out in Part 1 (Letter from the Chairman of Amersham) of this document.

Notices convening the Court Meeting and the Amersham EGM, which will both be held at The Savoy Hotel, River Entrance, Savoy Place, London WC2R 0EU, England, on 17 March 2004, are set out at the end of this document. The Court Meeting will start at 10.30 a.m. (London time) and the Amersham EGM will start at 10.40 a.m. (London time) (or as soon thereafter as the Court Meeting shall have been concluded or adjourned). The action to be taken in respect of the Court Meeting and the Amersham EGM is set out on the next page, and in Section 9 of Part 1 (Letter from the Chairman of Amersham) and Section 7 of Part 2 (Explanatory Statement) of this document. It is very important that you use your vote in order that the Court can be satisfied that the votes cast constitute a fair representation of the views of the Amersham Shareholders.

Goldman Sachs is acting exclusively for GE and no one else in connection with the Acquisition and will not be responsible to anyone other than GE for providing the protections afforded to customers of Goldman Sachs nor for providing advice in relation to the Acquisition, or any matter referred to herein.

JPMorgan is acting exclusively for Amersham as joint financial adviser and no one else in connection with the Acquisition and will not be responsible to anyone other than Amersham for providing the protections afforded to customers of JPMorgan nor for providing advice in relation to the Acquisition, or any matter referred to herein.

Morgan Stanley & Co. Limited is acting exclusively for Amersham as joint financial adviser and no one else in connection with the Acquisition and will not be responsible to anyone other than Amersham for providing the protections afforded to clients of Morgan Stanley & Co. Limited nor for providing advice in relation to the Acquisition, or any matter referred to herein.

Throughout this document, unless the context otherwise requires, references to “GE” mean both General Electric Company and GE Investments, Inc. who are together proposing to acquire Amersham plc.

Definitions used in this document are set out in Part 8 (Definitions) of this document.

Action to be taken

If you are an Amersham Shareholder, whether or not you intend to attend either or both of the Court Meeting and the Amersham EGM, please complete and sign the enclosed Forms of Proxy and return them in the enclosed reply-paid envelope (for use in the UK only) in accordance with the instructions printed thereon as soon as possible, but in any event, so as to be received by Lloyds TSB Registrars, The Causeway, Worthing, West Sussex, BN99 3DW, United Kingdom, at least 48 hours before the time fixed for the relevant meeting or any adjournment thereof. Forms of Proxy returned by fax will not be accepted. If the blue Form of Proxy for use at the Court Meeting is not lodged by then it may be handed to the Chairman of the Court Meeting at that meeting. However, in the case of the Amersham EGM, unless the pink Form of Proxy is lodged at least 48 hours before the time fixed for the meeting or any adjournment thereof, it will be invalid. The completion and return of a Form of Proxy will not prevent you from attending and voting in person at either the Court Meeting or the Amersham EGM, or any adjournment thereof, if you wish to do so. You may return the Forms of Proxy electronically by logging onto the website www.sharevote.co.uk and using the authentication reference number shown on your Form of Proxy. Full details of the procedures to be followed if you wish to return your Forms of Proxy electronically are given on the website. Electronic proxy appointments must be received at least 48 hours before the time fixed for the relevant meeting or any adjournment thereof.

If you have any questions relating to this document or the completion and return of the Forms of Proxy or the Form of Election, please telephone our shareholder helpline on 0845 766 0776 (or, if you are calling from outside the United Kingdom, on +44 1903 702 767) between 8.30 a.m. and 5.30 p.m. (London time) Monday to Friday, until 17 March 2004. The helpline cannot provide advice on the merits of the Scheme or the Acquisition or give any financial advice.

If you hold an entitlement to Amersham Shares through the VPS in Norway, please complete and sign the enclosed green VPS Voting Instruction Card and return it in the enclosed reply-paid envelope (for use in Norway only) in accordance with the instructions thereon as soon as possible, but in any event, so as to be received by DnB NOR Bank ASA, Verdipapirservice, 0021 Oslo, Norge, no later than 3.00 p.m. (Oslo time) on 10 March 2004. VPS Voting Instruction Cards returned by fax will not be accepted. If you have any questions relating to this document or the completion and return of the VPS Voting Instruction Card, please contact DnB NOR on telephone number 22 48 35 20 (or, if you are calling from outside Norway, on +47 22 48 35 20) between 8.00 a.m. and 4.00 p.m. (Oslo time) Monday to Friday, until 17 March 2004. The helpline cannot provide advice on the merits of the Scheme or the Acquisition or give any financial advice.

If you are a registered holder of Amersham ADSs, please complete and sign the enclosed white ADS Voting Instruction Card and return it in the enclosed reply-paid envelope (for use in the US only) in accordance with the instructions thereon as soon as possible, but in any event, so as to be received by Citibank Shareholder Services, PO Box 8527, Edison, New Jersey, USA, 08818-9395, no later than 10.00 a.m. (New York time) on 10 March 2004. ADS Voting Instruction Cards returned by fax will not be accepted. If you hold your Amersham ADSs indirectly, you must rely on the procedures of the bank, broker, financial institution or share plan administrator through which you hold your Amersham ADSs if you wish to vote. If you have any questions relating to this document or the completion and return of the ADS Voting Instruction Card, please contact Citibank, N.A. on telephone number 877 248 4237 (or, if you are calling from outside the US, on +1 877 248 4237) between 8.30 a.m. and 6.00 p.m. (New York time) Monday to Friday, until 17 March 2004. The helpline cannot provide advice on the merits of the Scheme or the Acquisition or give any financial advice.

Securities law restrictions

The distribution of this document in jurisdictions other than the United Kingdom, the US and Norway may be restricted by law and therefore persons into whose possession this document comes should inform themselves about and observe such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities laws of any such jurisdiction. This document and the accompanying documents have been prepared for the purpose of complying with (i) English law, the City Code and the applicable rules of the UK Listing Authority and the London Stock Exchange, (ii) the applicable requirements of the US federal and state securities laws and the applicable rules and regulations of the NYSE (except to the extent exempt from such requirements) and (iii) the applicable Norwegian rules and regulations. This document and the Conditions and further terms set out in this document are governed by English law and are subject to the jurisdiction of the English courts. The

delivery of New GE Shares to Amersham Shareholders and holders of Amersham ADSs under the Scheme has not been and will not be registered under the Securities Act in reliance upon the exemption from the registration requirements of the Securities Act provided by section 3(a)(10) thereof and Amersham will furnish this document to the SEC under the cover of a Form 6-K. Amersham Shareholders and holders of Amersham ADSs who are affiliates of Amersham or GE prior to, or will be affiliates of GE after, the Effective Date will be subject to certain US transfer restrictions relating to New GE Shares received under the Scheme. These transfer restrictions are explained in Section 16 of Part 2 (Explanatory Statement ) of this document. Neither the SEC nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this document. Any representation to the contrary is a criminal offence in the United States. The information disclosed in this document may not be the same as that which would have been disclosed if this document had been prepared for the purpose of complying with the registration requirements of the Securities Act or in accordance with the laws and regulations of any other jurisdiction. This document is not a prospectus under Norwegian law and consequently it has not been and it will not be registered with any Norwegian securities authority. This document does not constitute an offer to sell or issue, or the solicitation of an offer to buy or subscribe, shares in any jurisdiction in which such offer or solicitation is unlawful.

Forward looking information

This document and other information published by GE and Amersham may contain forward looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. Forward looking statements may be identified by words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “will” or words of similar meaning and include, but are not limited to, statements about the expected future business and financial performance of the GE Group resulting from and following the Acquisition. These statements are based on management’s current expectations and are inherently subject to uncertainties and changes in circumstances. Among the factors that could cause actual results to differ materially from those described in the forward looking statements are factors relating to satisfaction of the Conditions, GE’s ability to successfully combine the businesses of GE Medical and Amersham and to realise expected synergies from the Acquisition, and changes in global, political, economic, business, competitive, market and regulatory forces. More detailed information about certain of these factors is contained in General Electric’s and Amersham’s filings with the SEC. Neither GE nor Amersham undertakes any obligation to update the forward looking statements to reflect actual results, or any change in events, conditions, assumptions or other factors.

Dealings

Any person who, alone or acting together with any other person(s) pursuant to an agreement or understanding (whether formal or informal) to acquire or control securities of General Electric or of Amersham, owns or controls, or becomes the owner or controller, directly or indirectly, of one per cent. or more of any class of securities of General Electric or Amersham is generally required under the provisions of Rule 8 of the City Code to notify a Regulatory Information Service as specified in the Listing Rules and the Panel by not later than 12 noon (London time) on the London business day following the date of the transaction of every dealing in such securities during the period to the Effective Date. Dealings by GE or by Amersham or by their respective “associates” (within the definition set out in the City Code) in any class of securities of General Electric or Amersham until the end of such period must also be disclosed. Please consult your financial adviser immediately if you believe this Rule may be applicable to you.

[THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]

TABLE OF CONTENTS


	Page

EXPECTED TIMETABLE OF PRINCIPAL EVENTS		6
PART 1 LETTER FROM THE CHAIRMAN OF AMERSHAM		7
1. Introduction		7
2. Summary of the Acquisition		7
3. Current trading		8
4. Background to and reasons for the recommendation of the Acquisition		8
5. Directors’ undertakings to support the Acquisition		9
6. Management and employees		9
7. Amersham Employee Share Schemes		9
8. Taxation		10
9. Action to be taken		10
10. Dealing facility		12
11. Overseas shareholders		13
12. Recommendation		13
PART 2 EXPLANATORY STATEMENT		14
1. Introduction		14
2. Summary of the terms of the Acquisition and the Scheme		14
3. Effect of the Scheme on the interests of the Amersham Directors		17
4. Information on Amersham		18
5. Structure of the Acquisition and the Scheme		19
6. The Court Meeting and the Amersham EGM		20
7. Action to be taken		21
8. Amersham Employee Share Schemes		24
9. Listings, dealings and settlement		24
10. Description of the Implementation Agreement		27
11. Conditions to the Scheme and the Acquisition		27
12. Description of the New GE Shares		27
13. United Kingdom tax		28
14. United States federal tax		30
15. Norwegian tax		32
16. Overseas shareholders		34
PART 3 CONDITIONS TO THE SCHEME AND THE ACQUISITION		37
PART 4 FINANCIAL INFORMATION ON THE AMERSHAM GROUP		43
PART 5 INFORMATION ON THE GE GROUP		111
1. Background to and GE’s reasons for the Acquisition		111
2. Information on General Electric and GE Investments		112
3. Financial information on the GE Group		112
PART 6 INFORMATION ON THE GE SHARES		165
PART 7 ADDITIONAL INFORMATION		182
PART 8 DEFINITIONS		222
PART 9 THE SCHEME OF ARRANGEMENT		228
PART 10 NOTICE OF COURT MEETING		239
PART 11 NOTICE OF EXTRAORDINARY GENERAL MEETING		240

EXPECTED TIMETABLE OF PRINCIPAL EVENTS


Event	Time and/or date (2004)

Latest time for receipt by the Norwegian Sub-registrar of completed green VPS Voting Instruction Cards from holders of entitlements to Amersham Shares through the VPS in Norway		3.00 p.m. (Oslo time) on 10 March
Latest time for receipt by the Depositary of completed white ADS Voting Instruction Cards from registered holders of Amersham ADSs¹		10.00 a.m. (New York time) on 10 March
Latest time for receipt by the Registrar of completed blue Forms of Proxy for the Court Meeting²		10.30 a.m. on 15 March
Latest time for receipt by the Registrar of completed pink Forms of Proxy for the Amersham EGM and yellow Forms of Election²		10.40 a.m. on 15 March
Voting Record Time		6.00 p.m. on 15 March
Court Meeting		10.30 a.m. on 17 March
Amersham EGM		10.40 a.m. on 17 March³
10 day trading period upon which the Exchange Ratio will be calculated		23 March - 5 April⁴
Record date for proposed Amersham dividend		2 April⁴
Initial Court Hearing (to sanction the Scheme)		5 April⁴
Suspension of registration of transfers of Amersham Shares⁵		6.00 p.m. on 5 April⁴
Last day for dealings in Amersham Shares and Amersham ADSs		6 April⁴
Scheme Record Time		6.00 p.m. on 6 April⁴
Final Court Hearing (to confirm the reduction of capital)		7 April⁴
Effective Date		8 April⁴
Announcement of Exchange Ratio		8 April⁴
Expected announcement of General Electric’s first quarter results for 2004		8 April
Settlement of GE CDIs and New GE Shares to be issued through DTCC		8 April⁴
Dealings in New GE Shares commence		8 April⁴
Latest date for despatch of share certificates for New GE Shares and settlement of fractional entitlement payments		22 April⁴
Expected date for payment of proposed Amersham dividend		28 May⁴


¹	If you hold your Amersham ADSs indirectly you must rely on the procedures of the bank, broker, financial institution or share plan administrator through which you hold your Amersham ADS if you wish to vote.

²	A blue Form of Proxy for the Court Meeting not so lodged may be handed to the Chairman of the Court Meeting at that meeting. However, to be valid the pink Forms of Proxy for the Amersham EGM must be lodged by 10.40 a.m. on 15 March, or if the Amersham EGM is adjourned, at least 48 hours prior to the adjourned meeting.
³	The Amersham EGM will commence at the time specified above or, if later, as soon thereafter as the Court Meeting shall have been concluded or adjourned.
⁴	These dates are indicative only and will depend, amongst other things, on the dates upon which the Court sanctions the Scheme and/or confirms the reduction of capital.
⁵	Dealings in Amersham Shares after the third business day prior to the date of the Initial Court Hearing (which is expected to be 31 March 2004) will not, in accordance with normal settlement procedures, be registered prior to the Scheme Record Time.

Unless otherwise stated, references to times are to London time.

PART 1

LETTER FROM THE CHAIRMAN OF AMERSHAM


		Amersham plc Amersham Place Little Chalfont Buckinghamshire HP7 9NA

Registered in England and Wales No. 1002610

17 February 2004

To Amersham Shareholders and holders of Amersham ADSs and, for information only, to holders of options granted under the Amersham Employee Share Schemes

Dear Shareholder,

Recommended share exchange acquisition by General Electric Company and GE Investments, Inc. of Amersham plc

1. Introduction

I am writing to you to set out the terms of the acquisition of Amersham by GE, to explain the background to and reasons for our recommendation of the Acquisition, and to seek your support and approval for the Acquisition.

In order to approve the terms of the Acquisition, you will need to vote in favour of the resolutions to be proposed at two shareholder meetings (the Court Meeting and the Extraordinary General Meeting) to be held at The Savoy Hotel, River Entrance, Savoy Place, London, WC2R 0EU, England on 17 March 2004 from 10.30 a.m. The actions you should take, and the recommendation of the Amersham Board, are set out in Sections 9 and 12, respectively, of this Part 1.

2. Summary of the Acquisition

On 10 October 2003, Amersham and GE announced that they had reached agreement on the principal terms of a recommended pre-conditional share exchange acquisition of Amersham by GE. Since then, we have been working together to satisfy the pre-conditions, which have now been met.

The Acquisition will, subject to the satisfaction or waiver of the Conditions, be implemented by way of a scheme of arrangement of Amersham under section 425 of the Companies Act, which is expected to complete on 8 April 2004. Under the terms of the Acquisition, holders of Amersham Securities will be entitled to receive New GE Shares in exchange for the cancellation of their Amersham Securities on the basis of an Exchange Ratio and an ADS Exchange Ratio that will be finally determined on the day prior to the Final Hearing Date.

Holders of Amersham Securities will be entitled to receive New GE Shares on the following basis:


	•	for each Amersham Share, a number of New GE Shares as determined by the Exchange Ratio, such number not to exceed 0.5571; and

	•	for each Amersham ADS, a number of New GE Shares as determined by the ADS Exchange Ratio, such number not to exceed 2.7855.

If the Exchange Ratio were calculated on the basis of the Sterling GE Price at Posting of £17.84, Amersham Shareholders would be entitled to 0.4483 New GE Shares for each Amersham Share held (or to which they were entitled through the VPS), implying a Sterling Value at Posting for each Amersham Share of £8.00. If the ADS Exchange Ratio were calculated on the basis of the Sterling GE Price at Posting of £17.84, holders of Amersham ADSs would be entitled to 2.2415 New GE Shares for each Amersham ADS held, implying a Sterling Value at Posting for each Amersham ADS of £40.00. As described in Section 2 of Part 2 (Explanatory Statement) of this document, if the Final Sterling GE Price is greater than the Sterling GE Price at Posting, the Exchange Ratio and the ADS Exchange Ratio will be calculated so as to give Amersham Shareholders and holders of Amersham ADSs the benefit of this

increase until the Sterling Value of the New GE Shares to be delivered increases to a maximum of £8.08 for each Amersham Share (£40.40 for each Amersham ADS). If the Final Sterling GE Price is less than the Sterling GE Price at Posting, the Exchange Ratio and the ADS Exchange Ratio will be calculated so that the number of New GE Shares to be delivered will give each Amersham Share a Sterling Value of £8.00 (£40.00 for each Amersham ADS), subject to the Maximum Exchange Ratio of 0.5571 (or, in relation to the ADS Exchange Ratio, 2.7855). Further details of how the Exchange Ratio will be finally determined are set out in Section 2 of Part 2 (Explanatory Statement) of this document. The sterling amount realisable upon the sale of a New GE Share at the time such share is delivered to a holder of Amersham Securities (or at any subsequent time) will depend upon both the market price of a GE Share and the relevant exchange rate at that time. Such amount may be more or less than £8.00 or £8.08, as the case may be.

If the Exchange Ratio were calculated on the basis of the Sterling GE Price at Posting, up to 316.2 million New GE Shares (322.2 million on a diluted basis using the treasury method) would be delivered under the Acquisition, representing approximately 3 per cent. of the issued share capital of General Electric as enlarged by the Acquisition. On the basis of the Maximum Exchange Ratio, the Acquisition would result in the delivery of 393.0 million New GE Shares (400.4 million on a diluted basis using the treasury method) representing approximately 4 per cent. of the issued share capital of General Electric as enlarged by the Acquisition.

On the basis described above, using the Sterling GE Price at Posting, the Sterling Value at Posting of each Amersham Share would be £8.00, and the value of the diluted share capital of Amersham would be approximately £5.8 billion. These terms represent a premium of approximately 45 per cent. to the price of an Amersham Share of £5.52 as at the close of business on 7 October 2003, the last trading day prior to the announcement by Amersham that it had received an approach.

As announced today, Amersham Shareholders will be entitled, subject to completion of the Acquisition, to receive from Amersham a dividend of 5.92p for each Amersham Share in respect of the year ended 31 December 2003 payable to shareholders on the register of members of Amersham on the last trading day prior to the Initial Court Hearing (anticipated to be 2 April 2004). This dividend is expected to be paid by Amersham on 28 May 2004 in accordance with existing arrangements for dividend payments.

The New GE Shares delivered under the Acquisition will rank pari passu in all respects with the existing GE Shares. The New GE Shares will rank pari passu for any dividend declared or paid by General Electric by reference to a record date on or after the Effective Date. Assuming the Effective Date is, as expected, 8 April 2004, it is anticipated that the first dividend to which holders of Amersham Securities who receive and retain New GE Shares would be entitled will have a record date in June 2004 and will be paid by General Electric in July 2004.

With effect from the close of trading on the day of the Final Court Hearing, Amersham Securities will not be listed on any stock exchange. The New GE Shares will be listed on the NYSE, as well as the London Stock Exchange, the Boston Stock Exchange and Euronext Paris.

Further details of the Acquisition and the Scheme can be found in Part 2 (Explanatory Statement) of this document.

3. Current trading

In its preliminary unaudited results for the year ended 31 December 2003, Amersham reported sales of £1,652 million (2002: £1,618 million), total operating profit (before exceptional items and goodwill amortisation) of £299 million (2002: £310 million), earnings for each Amersham Share before exceptional items and goodwill amortisation of 29.0p (2002: 29.9p) and net debt of £147 million (2002: £182 million). Sir William Castell commented: “Our strong results in the second half of 2003 reflect unwavering focus on our business fundamentals. We continued to expand sales of our patented Medical Diagnostics products at an excellent rate; delivered stronger second half growth in Protein Separations, moved Discovery Systems into profit in the second half, ahead of schedule, and we delivered improved underlying margins for Amersham”.

4. Background to and reasons for the recommendation of the Acquisition

The Amersham Board believes the terms of the Acquisition represent attractive value for holders of Amersham Securities.

Amersham is a global leader in medical diagnostics and in life sciences. Its strategy has been to build its position as a leading provider of products and technologies enabling disease to be better understood, diagnosed earlier and treated more effectively.

In 1997, Amersham merged its life science business with the biotech division of Pharmacia & Upjohn to form Amersham Pharmacia Biotech, now known as Amersham Biosciences, in which it held a 55 per cent. interest. In the same year, Amersham merged with Nycomed ASA of Norway. This gave Amersham the global franchise and breadth of skills in medical diagnostics and life sciences that are critical for delivering its strategy in molecular medicine – skills that it has since built on and strengthened into two fully-fledged profitable businesses. Amersham’s purchase of the remaining equity in Amersham Biosciences in 2002 completed the process of merging the businesses, enabling Amersham to draw on a skill base in molecular medicine across the Amersham Group and to drive towards its long-term vision of enabling personalised medicine.

The combination of Amersham and GE Medical to form GE Healthcare will accelerate this vision. In particular, Amersham will add new, high-technology platforms and skills in biology and chemistry to GE Medical’s diagnostic imaging, healthcare services and information technology businesses.

Through the combination of skills in imaging, engineering, biology, chemistry and instrumentation, GE Healthcare will be able to take the knowledge being generated in gene and protein research directly into diagnosis. GE Healthcare will have the competences, the marketing reach and the financial resources to bring disease prediction, diagnosis and personalised treatment into the mainstream of medical practice.

In particular, the Amersham Directors believe the Acquisition will:


	•	position the combined business for a new chapter in medicine by creating a healthcare business with broad expertise in imaging, diagnostic pharmaceuticals and drug discovery;

	•	accelerate the development of molecular imaging and personalised medicine by accelerating and bringing to market new targeted imaging agents and diagnostics that will enable our customers to diagnose, treat and monitor diseases at an earlier stage than ever before; and

	•	expand the addressable customer base, providing significant new channels for each company’s products and services around the world.

GE Healthcare will comprise technology and service driven healthcare businesses which had combined 2003 pro-forma revenues of approximately $13 billion.

5. Directors’ undertakings to support the Acquisition

6. Management and employees

GE has stated that it attaches great importance to the skills and experience of the existing management and employees of the Amersham Group and believes that such management and employees will benefit from the greater opportunities within the GE Group following completion of the Acquisition. Following completion of the Acquisition, the existing employment rights, including pension rights, of all management and employees of the Amersham Group will be fully safeguarded.

Following completion of the Acquisition, Sir William Castell will become a Vice Chairman and member of the General Electric Board and, as CEO of GE Healthcare, will have financial and leadership responsibility for GE Healthcare, the combined Amersham and GE Medical businesses. Joseph Hogan, Senior Vice President of General Electric, will continue to lead the GE Medical business. The GE Healthcare business will be based with Sir William Castell in the United Kingdom.

7. Amersham Employee Share Schemes

Following the making by the Court of an order sanctioning the Scheme (expected to take place at the Initial Court Hearing on 5 April 2004), all options and awards granted under the Amersham Employee Share Schemes will be capable of exercise or release. Details of how these options and awards will be affected by the Scheme can be found in Section 10 of Part 7 (Additional Information) of this document. Holders of options and awards granted under the Amersham Employee Share Schemes will also

receive separate documentation explaining the effect of the Acquisition on their entitlements and the choices open to them.

8. Taxation

The taxation consequences of the Scheme will depend upon the jurisdiction in which you are resident. Summaries of the tax consequences of the Scheme for Amersham Shareholders resident for tax purposes in the United Kingdom, for holders of Amersham Securities who are subject to US federal tax and for holders of entitlements to Amersham Shares through the VPS who are resident for tax purposes in Norway are set out in Sections 13, 14 and 15, respectively, of Part 2 (Explanatory Statement) of this document. If you are in any doubt as to your tax position you should consult an appropriate independent professional adviser.

9. Action to be taken

You will find enclosed with this document:

If you are a registered holder of Amersham Shares


	•	a separate letter from me including a question and answer section to explain certain features of the Acquisition and the Scheme;

	•	a blue Form of Proxy for use in respect of the Court Meeting;

	•	a pink Form of Proxy for use in respect of the Amersham EGM; and

	•	a yellow Form of Election for you to make an election, if desired, as described in paragraph (b) below.

If you hold an entitlement to Amersham Shares through the VPS in Norway


	•	a separate letter from me including a question and answer section to explain certain features of the Acquisition and the Scheme;

	•	a Norwegian language summary of some of the key information contained in this document; and

	•	a green VPS Voting Instruction Card for use in respect of the Court Meeting and Amersham EGM.

If you are a registered holder of Amersham ADSs


	•	a separate letter from me including a question and answer section to explain certain features of the Acquisition and the Scheme; and

	•	a white ADS Voting Instruction Card for use in respect of the Court Meeting and Amersham EGM.

It is particularly important that as many votes as possible are cast at the Court Meeting so that the Court may be satisfied that there is a fair representation of Amersham Shareholder opinion. You are therefore strongly urged to return your Forms of Proxy, your VPS Voting Instruction Card or your ADS Voting Instruction Card (as appropriate), as soon as possible and in any event by the dates set out in paragraph (a) below.

(a) The Court Meeting and the Amersham EGM

(i) Amersham Shares on the UK register

If you are a registered holder of Amersham Shares, whether or not you intend to attend these meetings, please complete and sign both Forms of Proxy in accordance with the instructions printed thereon and return them either by post or by hand to the Registrar, Lloyds TSB Registrars, The Causeway, Worthing, West Sussex, BN99 3DW, United Kingdom, in each case so as to be received as soon as possible and in any event at least 48 hours before the time fixed for the relevant meeting or any adjournment thereof. A reply-paid envelope (for use in the United Kingdom only) is enclosed for this purpose. Forms of Proxy returned by fax will not be accepted.

be followed if you wish to return your Forms of Proxy electronically are given on the website and the current terms and conditions of this service are set out in Section 14 of Part 7 (Additional Information) of this document. Electronic proxy appointments must be received at least 48 hours before the time fixed for the relevant meeting or any adjournment thereof.

If the blue Form of Proxy relating to the Court Meeting is not lodged by the relevant time, it may be handed to the Chairman of the Court Meeting at that meeting. However, in the case of the Amersham EGM, unless the pink Form of Proxy is lodged so as to be received by 10.40 a.m. on 15 March 2004 (or where the Amersham EGM is adjourned, at least 48 hours before the time fixed for the adjourned Amersham EGM) and in accordance with the instructions on the pink Form of Proxy, it will be invalid.

The completion and return of a Form of Proxy will not prevent you from attending and voting in person at the Court Meeting or Amersham EGM, or any adjournment thereof, if you so wish.

Please note that, in relation to the blue Form of Proxy for the Court Meeting, your proxy may vote or abstain as he or she thinks fit on any modifications to the Scheme or any other business that may properly come before the Court Meeting unless otherwise instructed. In relation to the pink Form of Proxy for the Amersham EGM, if you do not give a specific voting instruction on the resolution to be considered at the Amersham EGM by placing a mark in the appropriate box, your proxy will be free to vote or abstain in relation to the resolution as he or she thinks fit. Unless you specifically instruct otherwise, your proxy may also vote or abstain as he or she thinks fit on any other business (including any amendments to the resolution to be proposed at the Amersham EGM) which may properly come before the Amersham EGM.

If you have any questions relating to this document or the completion and return of the Forms of Proxy, please telephone our shareholder helpline on 0845 766 0776 (or, if you are calling from outside the United Kingdom, on +44 1903 702 767) between 8.30 a.m. and 5.30 p.m. (London time) Monday to Friday, until 17 March 2004. The helpline cannot provide advice on the merits of the Scheme or the Acquisition or give any financial advice.

(ii) Entitlements to Amersham Shares held through the VPS in Norway

If you hold an entitlement to Amersham Shares through the VPS in Norway, you may instruct DnB NOR, as Norwegian Sub-registrar, how to vote at the Court Meeting and/or Amersham EGM in respect of the Amersham Shares to which you hold an entitlement. A green VPS Voting Instruction Card is enclosed for this purpose and must be completed, signed and returned in accordance with the instructions printed thereon to DnB NOR Bank ASA, Verdipapirservice, 0021 Oslo, Norge, so that it is received as soon as possible and in any event no later than 3.00 p.m. (Oslo time) on 10 March 2004. A reply-paid envelope (for use in Norway only) is enclosed for this purpose. VPS Voting Instruction Cards returned by fax will not be accepted.

You may vote in person at the Court Meeting and/or the Amersham EGM if you become the registered holder of the Amersham Shares to which you hold an entitlement. You may become the registered holder by requesting DnB NOR, as Norwegian Sub-registrar, to exchange the interest which you hold through the VPS in Norway for the Amersham Shares which are registered on the main UK register of members of Amersham to which you hold an entitlement in accordance with the terms of the VPS Registrar Agreement. Any requests for such exchange must be received by DnB NOR no later than 3.00 p.m. (Oslo time) on 10 March 2004.

If you would like further information on how to exchange your shares or have any questions relating to this document or the completion and return of the VPS Voting Instruction Card, please contact DnB NOR on telephone number 22 48 35 20 (or, if you are calling from outside Norway, on +47 22 48 35 20) between 8.00 a.m. and 4.00 p.m. (Oslo time) Monday to Friday, until 17 March 2004. The helpline cannot provide advice on the merits of the Scheme or the Acquisition or give any financial advice.

(iii) Amersham ADSs

reply-paid envelope (for use in the US only) is enclosed for this purpose. ADS Voting Instruction Cards returned by fax will not be accepted. If you hold your Amersham ADSs indirectly, you must rely on the procedures of the bank, broker, financial institution or share plan administrator through which you hold your Amersham ADSs if you wish to vote.

You may vote in person at the Court Meeting and/or the Amersham EGM if you become the registered holder of the Amersham Shares underlying your Amersham ADSs by arranging for the surrender of your Amersham ADSs in accordance with the terms and conditions of the Deposit Agreement.

If you would like further information on surrendering your Amersham ADSs or have any questions relating to this document or the completion and return of the ADS Voting Instruction Card, please contact Citibank, N.A. on telephone number 877 248 4237 (or, if you are calling from outside the US, on +1 877 248 4237) between 8.30 a.m. and 6.00 p.m. (New York time) Monday to Friday, until 17 March 2004. The helpline cannot provide advice on the merits of the Scheme or the Acquisition or give any financial advice.

(b) Election

The Acquisition is being made jointly by General Electric and GE Investments.

It may be relevant to you whether you receive your New GE Shares from General Electric or from GE Investments. In particular, UK rollover relief (for the purposes of taxation of chargeable gains) will only be available to an eligible Amersham Shareholder to the extent that such shareholder’s Amersham Shares are cancelled in exchange for New GE Shares received from General Electric rather than from GE Investments. This would involve a prior reclassification of your Amersham Shares as A Ordinary Shares as described in Section 5 of Part 2 (Explanatory Statement) of this document.

If you hold Amersham Shares and want to receive the New GE Shares to which you become entitled under the Scheme from General Electric, you should complete and sign the enclosed yellow Form of Election and return it in the enclosed reply-paid envelope (for use in the United Kingdom only) in accordance with the instructions printed thereon as soon as possible, but in any event, so as to be received by Lloyds TSB Registrars, The Causeway, Worthing, West Sussex, BN99 3DW, United Kingdom, no later than 10.40 a.m. (London time) on 15 March 2004 (or such later date as may be publicly announced by Amersham and GE). Any election made by an Amersham Shareholder shall (unless otherwise agreed by Amersham and GE) be made in respect of all of the Amersham Shares held by him or her at the Reclassification Record Time. On implementation of the Scheme, General Electric will deliver approximately 75 per cent. of the New GE Shares to be delivered under the Scheme. Information on the allocation procedures where elections are received for greater or less than 75 per cent. of the New GE Shares is set out in Section 7 of Part 2 (Explanatory Statement) of this document.

If you are not concerned whether you receive New GE Shares from General Electric you need not complete a Form of Election.

The rights attaching to the New GE Shares will be identical whether they are delivered by General Electric or GE Investments.

If you hold an entitlement to Amersham Shares through the VPS in Norway or you are a registered holder of Amersham ADSs, you may request in writing when returning your VPS Voting Instruction Card or your ADS Voting Instruction Card (as appropriate) to receive the New GE Shares to which you become entitled under the Scheme from General Electric rather than from GE Investments.

10. Dealing facility

On announcement of the transaction, GE stated it would provide holders of Amersham Securities who own 5,000 or fewer Amersham Shares (1,000 or fewer Amersham ADSs) with a free dealing facility, enabling them to sell New GE Shares received as part of the transaction without incurring dealing charges. Despite extensive discussions, GE has not yet obtained the regulatory clearances it requires to provide such a dealing facility. We continue to explore with GE alternative means by which these holders of Amersham Securities can sell their New GE Shares without incurring dealing charges. Any such arrangements will be subject to regulatory clearances being obtained on a reasonably practicable basis. These clearances have not yet been obtained and there is no assurance that they will be forthcoming.

Further details will be sent to relevant holders of Amersham Securities at the appropriate time.

11. Overseas shareholders

Persons resident in, or citizens of, jurisdictions outside the United Kingdom, the US and Norway should refer to Section 16 of Part 2 (Explanatory Statement) of this document which contains important information relevant to you.

12. Recommendation

The Amersham Board, which has been so advised by JPMorgan and Morgan Stanley, considers the terms of the Acquisition to be fair and reasonable. In providing advice to the Amersham Board, JPMorgan and Morgan Stanley have taken into account the commercial assessment of the Amersham Board.

The Amersham Board believes that the terms of the Acquisition (including the Scheme) are in the best interests of Amersham Shareholders as a whole and unanimously recommends that Amersham Shareholders vote in favour of the resolutions to be proposed at the Court Meeting and the Amersham EGM, as the Amersham Directors who hold Amersham Shares have undertaken to do in respect of their own beneficial holdings.

Yours faithfully,

(Donald Brydon Signature)

Donald Brydon

Chairman, Amersham plc

PART 2

EXPLANATORY STATEMENT

(in compliance with section 426 of the Companies Act)


J.P. Morgan plc 125 London Wall London EC2Y 5AJ		Morgan Stanley & Co. Limited 25 Cabot Square London E14 4QA
Registered in England and Wales no. 248609		Registered in England and Wales no. 2164628

17 February 2004

To Amersham Shareholders and holders of Amersham ADSs and, for information only, to holders of options granted under the Amersham Employee Share Schemes

Dear Shareholder,

Recommended share exchange acquisition by General Electric Company and GE Investments, Inc. of Amersham plc

1. Introduction

On 10 October 2003, GE and Amersham announced their agreement on the principal terms of a recommended share exchange acquisition by GE of Amersham. Subject to the satisfaction or waiver of the Conditions, the Acquisition will be implemented by means of a scheme of arrangement under section 425 of the Companies Act.

Your attention is drawn to the letter from the Chairman of Amersham set out in Part 1 (Letter from the Chairman of Amersham) of this document which forms part of the Explanatory Statement and which contains, amongst other things, information on the reasons for the Acquisition and the unanimous recommendation by the Amersham Board to Amersham Shareholders to vote in favour of the resolutions to approve and implement the Acquisition to be proposed at the Court Meeting and the Amersham EGM. Your attention is also drawn to the information in the other Parts of this document, which also form part of the Explanatory Statement.

The Amersham Board has been advised by JPMorgan and Morgan Stanley in connection with the Acquisition and the Scheme. We have been authorised by the Amersham Board to write to you to explain the terms of the Acquisition and the Scheme and to provide you with other relevant information.

Statements made or referred to in this letter which refer to GE’s reasons for the Acquisition, to information concerning the business of the GE Group and to the intentions and expectations regarding the GE Group, reflect the views of the boards of directors of both General Electric and GE Investments. Statements made or referred to in this letter which refer to the background to the recommendation of the Amersham Board, to information concerning the business of the Amersham Group and to expectations regarding Amersham, reflect the views of the Amersham Board.

2. Summary of the terms of the Acquisition and the Scheme

The Acquisition is to be implemented by means of a scheme of arrangement between Amersham and its shareholders under section 425 of the Companies Act. The Acquisition will not be completed unless all the Conditions set out in Part 3 (Conditions to the Scheme and the Acquisition) of this document have been satisfied or, if permitted, waived by the close of business (London time) on 31 December 2004, or such later date as Amersham and GE may propose and the Court may approve. These Conditions include the approval of the terms of the Scheme by the requisite majorities of the Amersham Shareholders at the Court Meeting and the Amersham EGM and the sanction of the Scheme and confirmation of the reduction of capital (which forms part of the Scheme) by the Court. The requisite majorities are described in Section 5 of this Part 2. The full terms of the Scheme are set out in Part 9

(The Scheme of Arrangement) of this document. GE has agreed to undertake to the Court to be bound by the terms of the Scheme.

(a) Consideration

Under the terms of the Scheme and subject to the Conditions and the further terms set out in this document, Amersham Shareholders and holders of Amersham ADSs will be entitled to receive New GE Shares on the following basis:


	•	for each Amersham Share, a number of New GE Shares as determined by the Exchange Ratio, such number not to exceed 0.5571; and

	•	for each Amersham ADS, a number of New GE Shares as determined by the ADS Exchange Ratio, such number not to exceed 2.7855.

The Exchange Ratio and the ADS Exchange Ratio will be finally determined on the day prior to the Final Hearing Date (as described in paragraph (b) below).

Further details of the financial effects of the Acquisition for holders of Amersham Securities are set out in paragraph (d) below.

If the Exchange Ratio were calculated on the basis of the Sterling GE Price at Posting, up to 316.2 million New GE Shares (322.2 million on a diluted basis using the treasury method) would be delivered under the Acquisition, representing approximately 3 per cent. of the issued share capital of General Electric as enlarged by the Acquisition. On the basis of the Maximum Exchange Ratio, the Acquisition would result in the delivery of 393.0 million New GE Shares (400.4 million on a diluted basis using the treasury method), representing approximately 4 per cent. of the issued share capital of General Electric as enlarged by the Acquisition.

No fractions of New GE Shares will be delivered to registered holders of Amersham Securities. Fractional entitlements to New GE Shares will be aggregated and sold in the market and the net proceeds of sale distributed pro rata to the registered holders of Amersham Securities entitled to them. None of GE nor any person acting on behalf of it shall have any liability to any person for any loss or alleged loss arising from the price, timing or manner of any sale in connection therewith. Details of how such cash entitlements (if any) will be paid to the registered holders of Amersham Securities entitled to them are set out in Section 9 of this Part 2.

The New GE Shares to be delivered as consideration under the Acquisition are described in Section 12 of this Part 2.

The Scheme provides that, as an initial step, the issued share capital of Amersham will be reclassified into two classes of shares, namely A Ordinary Shares and B Ordinary Shares, each as described more fully in Section 5 of this Part 2.

(b) Exchange Ratio mechanism

The Exchange Ratio and the ADS Exchange Ratio, representing the number of New GE Shares which will be delivered in respect of each Amersham Share or Amersham ADS (as appropriate) under the terms of the Scheme, will be finally determined on the day prior to the Final Hearing Date.

The Exchange Ratio will be calculated by dividing £8.00 by the Final Sterling GE Price, save that:


(i)	the Exchange Ratio shall not, in any circumstances, exceed 0.5571 New GE Shares for each Amersham Share;

(ii)	if the Final Sterling GE Price exceeds the Sterling GE Price at Posting by no more than 1 per cent., the Exchange Ratio will be the same as the Exchange Ratio at Posting (i.e. calculated by dividing £8.00 by the Sterling GE Price at Posting of £17.84 rather than by dividing £8.00 by the Final Sterling GE Price). This will enable holders of Amersham Securities to receive the benefit of this increase up to a Sterling Value of £8.08 for each Amersham Share; and

(iii)	if the Final Sterling GE Price exceeds the Sterling GE Price at Posting by more than 1 per cent., the Exchange Ratio will be calculated by dividing £8.08 by the Final Sterling GE Price.

The ADS Exchange Ratio will be determined by multiplying the Exchange Ratio (calculated as described above) by five.

The sterling amount realisable upon the sale of a New GE Share at the time such share is delivered to a holder of Amersham Securities (or at any subsequent time) will depend upon both the market price of a GE Share and the relevant exchange rate at that time. Such amount may be more or less than £8.00 or £8.08, as the case may be.

Although on the basis of the current timetable this is not expected to occur, if the GE Shares trade both with and without an entitlement to receive any dividend on one or more days within the ten trading day period by reference to which the Final Sterling GE Price is calculated (such that trading is both “cum” and “ex” dividend during such period), each holder of Amersham Securities will receive, as additional consideration for the cancellation of the Scheme Shares, a cash amount. This will be equal to the amount of the dividend payable on a GE Share multiplied by the number of New GE Shares delivered to each holder of Amersham Securities under the Scheme further multiplied by the percentage of “cum” dividend trading days included in the ten trading days by reference to which the Final Sterling GE Price is calculated. Details of how such cash entitlements (if any) will be paid to you are set out in Section 9 of this Part 2.

GE and Amersham have agreed, in the Implementation Agreement, that if certain changes are made to General Electric’s or Amersham’s share capital or certain extraordinary dividends are paid by General Electric or Amersham after the date of this document and before the Exchange Ratio is finally determined, such adjustments as are necessary will be made to the Maximum Exchange Ratio and the Exchange Ratio as Goldman Sachs, JPMorgan and Morgan Stanley agree are fair and reasonable such that the Exchange Ratio mechanism and the Maximum Exchange Ratio are replicated by reference to the GE Share price or Amersham Share price (as the case may be) as affected by the relevant change in share capital or extraordinary dividend. In the unlikely event any such adjustment will be required, an announcement will be made of the altered Exchange Ratio mechanism and/or the Maximum Exchange Ratio.

(c) Dividends

As announced on 17 February 2004, Amersham Shareholders will be entitled, subject to completion of the Acquisition, to receive from Amersham a dividend of 5.92p for each Amersham Share in respect of the year ended 31 December 2003 payable to shareholders on the register of members of Amersham on the last trading day prior to the Initial Court Hearing (anticipated to be 2 April 2004). This dividend is expected to be paid by Amersham on 28 May 2004 in accordance with existing arrangements for dividend payments.

On the basis of the current timetable, no further dividends will be payable by Amersham prior to the Effective Date. However, although this is not expected to be the case, if the Effective Date does not occur before 1 July 2004, Amersham Shareholders will also be entitled to receive from Amersham a dividend in respect of the six-month period ended 30 June 2004. Amersham has agreed to certain limits on the total amount of dividends it can declare or pay, details of which are set out in Section 12 of Part 7 (Additional Information) of this document.

The New GE Shares will rank pari passu for any dividend declared or paid by General Electric by reference to a record date on or after the Effective Date. Assuming the Effective Date is, as expected, 8 April 2004, it is anticipated that the first dividend to which holders of Amersham Securities who receive and retain New GE Shares would be entitled will have a record date in June 2004 and will be paid by General Electric in July 2004. General Electric generally pays dividends quarterly in US dollars.

(d) Financial effects of the Acquisition

Capital value

The following tables show, for illustrative purposes only and on the bases set out in the notes below them, the increase in capital value and income for a holder of 100 Amersham Shares based on the consideration to which such holder would be entitled under the Acquisition had it completed using an Exchange Ratio calculated on the basis of the Sterling GE Price at Posting. For a discussion of the actual Exchange Ratio mechanism, see paragraph (b) above.


	£

Market value of 100 Amersham Shares (Note 1)		552
Sterling Value at Posting of 44.83 New GE Shares (Note 2)		800

Increase (Note 3)		248

This represents an increase of		45%

Notes:


(1)	The market value of an Amersham Share was £5.52 on 7 October 2003 (the last trading day prior to the announcement by Amersham that it had received an approach) being the official closing price on the London Stock Exchange at close of business as derived from Bloomberg.

(2)	The Sterling Value at Posting of the New GE Shares is based on the Sterling GE Price at Posting (being £17.84) and an Exchange Ratio at Posting of 0.4483 New GE Shares. No fractions of New GE Shares will be delivered to registered holders of Amersham Securities. Fractional entitlements to New GE Shares will be aggregated and sold in the market and the net proceeds of sale distributed pro rata to them.

(3)	No account has been taken of taxation.


	£
Income
Dividend income from 100 Amersham Shares (Note 1)		8.77
Dividend income (in sterling) from New GE Shares (Note 2)		18.20

Increase (Note 3)		9.43

This represents an increase of		108%

Notes:


(1)	Dividend income from Amersham Shares is based on the aggregate cash dividends of 8.77 pence per Amersham Share paid or proposed in respect of the financial year ended 31 December 2003.

(2)	Dividend income from New GE Shares is based on the aggregate cash dividends of $0.77 per GE Share declared in respect of the financial year ended 31 December 2003 translated into sterling at the $/£ exchange rate of 1.90 set out in Section 18(i) of Part 7 (Additional Information) of this document. No fractions of New GE Shares will be delivered to registered holders of Amersham Securities. Fractional entitlements to New GE Shares will be aggregated and sold in the market and the net proceeds of sale distributed pro rata to them.

(3)	No account has been taken of taxation.


3.	Effect of the Scheme on the interests of the Amersham Directors

Undertakings to vote in favour of the Scheme have been received by GE from Amersham Directors (and the spouse of one director) who hold in aggregate 470,406 Amersham Shares (representing 0.067 per cent. of the issued share capital of Amersham). Such undertakings will cease to be binding if the Amersham Board withdraws its recommendation of the Acquisition. Further details of the interests of the Amersham Directors in the share capital of Amersham are set out in Section 7 of Part 7 (Additional Information) of this document.

Certain Amersham Directors, in common with the other participants in the Amersham Employee Share Schemes, will also be offered proposals (which will be subject to the Court sanction of the Scheme) in respect of their options and awards under such share schemes (see Section 10 of Part 7 (Additional Information) of this document).

Following completion of the Acquisition, Sir William Castell will become a Vice Chairman and member of the General Electric Board. On 11 February 2004, Sir William Castell entered into a new service contract with General Electric for a fixed period of two years, commencing shortly after completion of the Acquisition. Under this contract his total emoluments will be different from those under his existing service contract with Amersham.

In light of the period of time between the announcement of the Acquisition, satisfaction of the regulatory pre-conditions and the Acquisition becoming effective, and to ensure continuity of leadership throughout that period, on 10 October 2003 (and with the agreement of GE) the service contracts of each of the executive directors, with the exception of Sir William Castell, were varied to (a) give each executive director an entitlement to a retention bonus payable nine months after completion of the Acquisition or, if relevant, nine months after any public announcement that the Acquisition will not proceed; (b) give each executive director an entitlement to a special payment payable in two equal instalments at six and twelve months after completion of the Acquisition; and (c) reduce each executive director’s notice period to three months with effect from completion of the Acquisition.

Also to ensure continuity prior to completion of the Acquisition, on 10 October 2003, Donald Brydon entered into a new letter of appointment for a fixed period of twelve months until 8 October 2004 (and extendable at Amersham’s request until 7 July 2005) which entitles him to a compensation payment if he is required to resign before the relevant expiry date.

Particulars of the existing service contracts and letters of appointment of the Amersham Directors and the variations made to them (including details of the executive directors’ entitlements to a retention bonus and a special payment), Donald Brydon’s new letter of appointment and Sir William Castell’s new service contract, are set out in Section 11 of Part 7 (Additional Information) of this document.

Save as set out above, there are currently no proposed changes to the service contracts and letters of appointment of any Amersham Directors and the total emoluments receivable by the Amersham Directors will not be varied as a consequence of the completion of the Acquisition.

The Amersham Directors will be subject to certain restrictions under US securities laws on the resale of the New GE Shares received by them (if any) pursuant to the Scheme by reason of their being affiliates of Amersham and also, in the case of Sir William Castell, by reason of his being an affiliate of GE following his appointment to the General Electric Board as described in more detail in Section 16 of this Part 2. None of the Amersham Directors has committed to retain their New GE Shares. As a consequence of his personal financial planning, Sir William Castell intends in compliance with the relevant regulations, immediately following the Effective Date, to sell all of the New GE Shares that he will receive under the Scheme. It is likely that other Amersham Directors entitled to New GE Shares will also sell some or all of their New GE Shares.

Save as referred to above, the effect of the Scheme on the interests of each Amersham Director does not differ from its effect on the like interests of any other person.

When considering the recommendation of the Amersham Board, you should be aware that the Amersham Directors and members of Amersham’s senior management may have interests in the Acquisition that are different from, or in addition to, yours, as described above and in Sections 10 and 11 of Part 7 (Additional Information) of this document.

4. Information on Amersham

Amersham, headquartered in the United Kingdom, is a global leader in medical diagnostics and life sciences. The Amersham Group employs over 10,000 people worldwide and had sales of £1.7 billion ($2.7 billion) in 2003. The Amersham Group was formed in 1997 through the mergers of Amersham International (UK), Pharmacia Biotech (Sweden) and Nycomed ASA (Norway).

Amersham has three main business areas: medical diagnostics, operating as Amersham Health, and protein separations and discovery systems, together operating as Amersham Biosciences.

Amersham Health (59 per cent. of total Amersham sales in 2003) develops, manufactures and distributes diagnostic imaging agents and radio-pharmaceuticals for most imaging modalities that are used in medical imaging procedures. These diagnostic agents enable and enhance the imaging of anatomy, organs, tissue and cells to assist with the early detection, diagnosis and management of diseases. Key products include the imaging agents Omnipaque^TM, Myoview^TM, Omniscan^TM and Visipaque^TM.

Protein separations (18 per cent. of total Amersham sales in 2003) develops, manufactures and distributes chromatography purification systems, membrane products and reagents that are used in the development and manufacture of biopharmaceuticals and for the laboratory scale separation of proteins for research and drug development.

Discovery systems (23 per cent. of total Amersham sales in 2003) develops, manufactures and distributes instruments, reagents and software that are used for drug discovery, research and development with applications including protein and DNA analysis for genomics and proteomics, cellular screening and bioassays.

For the financial year ended 31 December 2003, Amersham reported sales of £1.7 billion ($2.7 billion) and net income of £116 million ($190 million). As at 31 December 2003, Amersham had net assets of £1.2 billion ($2.2 billion).

Further information on the Amersham Group (including a summary of the principal differences in the Amersham Group’s financial statements when prepared in accordance with US GAAP) is set out in

Part 4 (Financial Information on the Amersham Group) and Part 7 (Additional Information) of this document and also on its website at www.amersham.com.

5. Structure of the Acquisition and the Scheme

(a) The Scheme

The Acquisition is to be effected by means of a scheme of arrangement under section 425 of the Companies Act between Amersham and the Scheme Shareholders, the provisions of which are set out in full in Part 9 (The Scheme of Arrangement) of this document. The procedure involves an application by Amersham to the Court to sanction the Scheme and confirm the cancellation of all the Scheme Shares, in consideration for which the Scheme Shareholders who are on the register of members of Amersham at the Scheme Record Time will receive New GE Shares from GE credited as fully paid, on the basis described in Section 12 of this Part 2. General Electric and GE Investments will acquire Amersham jointly in accordance with the terms of the Scheme in the proportions of approximately 75 and 25 per cent., respectively.

The Acquisition will only complete if all of the Conditions, as further described in Section 11 of this Part 2, have been satisfied or, if permitted, waived.

(b) The reclassification

The Scheme provides that, as an initial step in the Scheme, the share capital of Amersham in issue at the Reclassification Record Time will be reclassified into two classes of shares, namely A Ordinary Shares and B Ordinary Shares. Holders of Scheme Shares reclassified as A Ordinary Shares will be entitled to receive New GE Shares from General Electric and holders of Scheme Shares reclassified as B Ordinary Shares will be entitled to receive New GE Shares from GE Investments. Save for this distinction, the reclassification of the Amersham Shares will have no other effect on the rights of Amersham Shareholders or holders of Amersham ADSs. The rights attaching to the New GE Shares to be delivered under the Scheme will be identical whether they are received from General Electric or from GE Investments.

As explained in Section 13 of this Part 2, UK rollover relief (for the purposes of taxation of chargeable gains) will only be available to an eligible Amersham Shareholder to the extent that such shareholder’s Amersham Shares are reclassified as A Ordinary Shares and are cancelled in exchange for New GE Shares received from General Electric rather than from GE Investments. If you are in any doubt as to your tax position you should consult an appropriate independent professional adviser.

If you hold Amersham Shares and you want to receive the New GE Shares to which you become entitled under the Scheme from General Electric, you should complete and sign the enclosed yellow Form of Election in accordance with the instructions set out in Section 7 of this Part 2. If you hold an entitlement to Amersham Shares through the VPS in Norway or you are a registered holder of Amersham ADSs, you may request in writing when returning your VPS Voting Instruction Card or your ADS Voting Instruction Card (as appropriate) to receive the New GE Shares to which you became entitled under the Scheme from General Electric rather than from GE Investments.

In order to facilitate this process, as part of the special resolution to be proposed at the Amersham EGM, it is proposed to approve the reclassification of the Amersham Shares and to amend the Articles of Association of Amersham so as to set out the separate rights of the A Ordinary Shares and the B Ordinary Shares as described above.

(c) Amersham Shareholder approvals

The Scheme requires the approval by Amersham Shareholders at both the Court Meeting and at the separate Amersham EGM, both of which will be held on 17 March 2004. The Court Meeting is being held at the direction of the Court to seek the approval of Amersham Shareholders to the Scheme. The Extraordinary General Meeting is being convened for the purposes described in Section 6 of this Part 2.

(d) Court hearings

Two Court hearings will be required following the Court Meeting and the Extraordinary General Meeting. The first will be to sanction the Scheme and the second will be to confirm the reduction of capital which forms part of the Scheme. It is expected that the Initial Court Hearing will be held on 5 April 2004 and that the Final Court Hearing will be held on 7 April 2004.

The Scheme will become effective upon the delivery of a copy of the Initial Court Order to the Registrar of Companies which is expected to take place on 6 April 2004. Following this, the reclassification of the Amersham Shares will be implemented. However, it is a condition to the implementation of the Scheme in full that the reduction of capital, which forms part of the Scheme, becomes effective. The reduction of capital will become effective only upon the delivery of a copy of the Final Court Order to, and registration of it by, the Registrar of Companies which is expected to take place on 8 April 2004. On completion of the Acquisition, the Scheme will be binding on all Amersham Shareholders, including any Amersham Shareholder who did not vote or who voted against the Scheme.

All Amersham Shareholders are entitled to attend the Court hearings in person or through counsel to support or oppose the Scheme.

6. The Court Meeting and the Amersham EGM

The Scheme requires the approval of the Amersham Shareholders both at the Court Meeting and the separate Amersham EGM to be held at the same place and on the same date. Only shareholders entered on the main UK register of members of Amersham at the Voting Record Time will be entitled to attend and vote at the relevant meetings in respect of the number of Amersham Shares registered in their name at the relevant time.

Notices of both the Court Meeting and the Amersham EGM are set out at the end of this document.

(a) Court Meeting

The Court Meeting has been convened at the direction of the Court for 10.30 a.m. on 17 March 2004 to enable the Amersham Shareholders to consider and, if thought fit, approve the Scheme. At the Court Meeting, voting will be by poll and each Amersham Shareholder present in person or by proxy will be entitled to one vote for each Amersham Share held. The approval required at the Court Meeting is that those voting in favour of the Scheme must:


(i)	represent a majority in number of those Amersham Shareholders present and voting in person or by proxy; and

(ii)	represent not less than three-fourths in value of the Amersham Shares held by those Amersham Shareholders present and voting in person or by proxy.

(b) Amersham EGM

The Amersham EGM has been convened for 10.40 a.m. on 17 March 2004, or as soon thereafter as the Court Meeting shall have been concluded or adjourned, to enable Amersham Shareholders to consider and, if thought fit, approve a special resolution to implement the Scheme by:


(i)	approving the Scheme;

(ii)	approving the reclassification of Amersham Shares described in Section 5 of this Part 2;

(iii)	approving a reduction in Amersham’s share capital and the subsequent issue of new Amersham Shares by Amersham to GE in accordance with the Scheme; and

(iv)	amending the Articles of Association of Amersham to allow the reclassification to take effect and for the purpose described below.

If passed by the requisite majority, the special resolution will amend the Articles of Association of Amersham to ensure that any Amersham Shares issued or transferred under the Amersham Employee Share Schemes or otherwise after the Amersham EGM and before the Reclassification Record Time will be subject to the Scheme. The amendment will also ensure that any Amersham Shares issued to any person (other than a member of the GE Group) after the Reclassification Record Time will be automatically transferred to General Electric in consideration of the delivery of New GE Shares by General Electric on the basis of the Exchange Ratio. These amendments are designed to avoid any person (other than a member of the GE Group) being left holding Amersham Shares. The proposed changes to Amersham’s Articles of Association are set out in Part 11 (Notice of the Extraordinary General Meeting) of this document. The special resolution will also declare the proposed dividend described in Section 2 of this Part 2.

The approval required at the Amersham EGM is not less than three-fourths of the votes cast. Voting will be on a show of hands, unless a poll is demanded, in which case those present in person or by proxy will be entitled to one vote for each Amersham Share held by them.

7. Action to be taken

You will find enclosed with this document:

If you are a registered holder of Amersham Shares


	•	a separate letter from the Chairman of Amersham including a question and answer section to explain certain features of the Acquisition and the Scheme;

	•	a blue Form of Proxy for use in respect of the Court Meeting;

	•	a pink Form of Proxy for use in respect of the Amersham EGM; and

	•	a yellow Form of Election for you to make an election, if desired, as described in paragraph (b) below.

If you hold an entitlement to Amersham Shares through the VPS in Norway


	•	a separate letter from the Chairman of Amersham including a question and answer section to explain certain features of the Acquisition and the Scheme;

	•	a Norwegian language summary of some of the key information contained in this document; and

	•	a green VPS Voting Instruction Card for use in respect of the Court Meeting and Amersham EGM.

If you are a registered holder of Amersham ADSs


	•	a separate letter from the Chairman of Amersham including a question and answer section to explain certain features of the Acquisition and the Scheme; and

	•	a white ADS Voting Instruction Card for use in respect of the Court Meeting and Amersham EGM.

(a) The Court Meeting and the Amersham EGM

(i) Amersham Shares on the UK register

You may return the Forms of Proxy electronically by logging onto the website www.sharevote.co.uk and using the authentication reference number shown on your Form of Proxy. Full details of the procedure to be followed if you wish to return your Forms of Proxy electronically are given on the website and the current terms and conditions of this service are set out in Section 14 of Part 7 (Additional Information) of this document. Electronic proxy appointments must be received at least 48 hours before the time fixed for the relevant meeting or any adjournment thereof.

where the Amersham EGM is adjourned, at least 48 hours before the time fixed for the adjourned Amersham EGM) and in accordance with the instructions on the pink Form of Proxy, it will be invalid.

The completion and return of a Form of Proxy will not prevent you from attending and voting in person at the Court Meeting or Amersham EGM, or any adjournment thereof, if you so wish.

(ii) Entitlements to Amersham Shares held through the VPS in Norway

(iii) Amersham ADSs

If you are a registered holder of Amersham ADSs, you may instruct Citibank, N.A., as the Depositary, how to vote the Amersham Shares underlying your Amersham ADSs at the Court Meeting and/or Amersham EGM. A white ADS Voting Instruction Card is enclosed for this purpose and must be completed, signed and returned in accordance with the instructions printed thereon to Citibank Shareholder Services, PO Box 8527, Edison, New Jersey, USA 08818-9395, so that it is received as soon as possible and in any event no later than 10.00 a.m. (New York time) on 10 March 2004. A reply-paid envelope (for use in the US only) is enclosed for this purpose. ADS Voting Instruction Cards returned by fax will not be accepted. If you hold your Amersham ADSs indirectly, you must rely on the procedures of the bank, broker, financial institution or share plan administrator through which you hold your Amersham ADSs if you wish to vote.

(b) Election

The Acquisition is being made jointly by General Electric and GE Investments.

It may be relevant to you whether you receive your New GE Shares from General Electric or from GE Investments. In particular, UK rollover relief (for the purposes of taxation of chargeable gains) will only be available to an eligible Amersham Shareholder to the extent that such shareholder’s Amersham Shares are reclassified as A Ordinary Shares and are cancelled in exchange for New GE Shares received from General Electric rather than from GE Investments.

If you are not concerned whether you receive New GE Shares from General Electric you need not complete a Form of Election.

On implementation of the Scheme, General Electric will deliver approximately 75 per cent. of the New GE Shares to be delivered under the Scheme. The allocation procedures to achieve these proportions will be as follows:


(i)	where valid elections are received in respect of a number of New GE Shares which would result in General Electric being obliged to deliver more than 75 per cent. of the aggregate number of New GE Shares to be delivered under the Scheme, the number of New GE Shares to which such valid elections relate will be scaled back pro rata such that General Electric will only be obliged to deliver 75 per cent. of those New GE Shares (rounded down to the extent necessary to avoid the reclassification of fractions of Scheme Shares). In such circumstances, the remaining New GE Shares to which such elections relate will be delivered by GE Investments. Those holders of Amersham Shares who did not make a valid election will receive their New GE Shares from GE Investments; and

(ii)	where elections are received in respect of a number of New GE Shares which would result in General Electric being obliged to deliver 75 per cent. or less of the aggregate number of New GE Shares to be delivered under the Scheme, those holders of Amersham Shares who made a valid election will receive their New GE Shares from General Electric. In such circumstances, Amersham will, in its absolute discretion, determine which other holders of Amersham Shares will receive some or all of their New GE Shares (if any) from General Electric (and in which proportions), subject to a maximum aggregate amount of 75 per cent. (rounded down to the extent necessary to avoid the reclassification of fractions of Scheme Shares) of the total number of New GE Shares to be delivered under the Scheme. Any further New GE Shares will be delivered by GE Investments. Neither GE nor Amersham nor any person acting on behalf of any of them shall have any liability to any person for any loss or alleged loss arising from the exercise of such discretion.

Holders of Amersham Securities will receive a personalised statement from the Settlement Agent not later than the expiry of the period of 28 days from the Effective Date setting out certain information about the New GE Shares to which they were entitled, including whether, and in what proportions, such shares were delivered by General Electric or GE Investments or both.

Where GE is advised that the delivery of New GE Shares under the Scheme would or may infringe the laws of any jurisdiction outside the United Kingdom, the US or Norway, or would or may require GE to comply with an unduly onerous or impossible requirement, for the purpose of the above allocation such New GE Shares will in all cases be delivered by GE Investments (whether or not such Amersham Shareholder had previously submitted a valid Form of Election or, in the case of holders of entitlements to Amersham Shares through the VPS in Norway or registered holders of Amersham ADSs, a written request to receive New GE Shares from General Electric). Any such New GE Shares delivered in these circumstances by GE Investments, will be sold and the net proceeds of sale will be remitted to the holders of Amersham Securities on whose behalf they were sold. Further information about the delivery of New GE Shares in these circumstances is set out in Section 16 of this Part 2.

8. Amersham Employee Share Schemes

The terms of the Scheme, if approved by Amersham Shareholders and the Court, will bind all Amersham Shareholders (including holders of Amersham Shares issued or transferred before the Scheme Record Time upon the exercise of share options or share awards granted under the Amersham Employee Share Schemes).

The implications of the Scheme for share options and share awards granted and outstanding under the Amersham Employee Share Schemes are summarised in Section 10 of Part 7 (Additional Information) of this document. Participants in each of the Amersham Employee Share Schemes will be notified separately of the impact of the Scheme on them.

Following the Scheme becoming effective, no further grants of share options or share awards will be made under the Amersham Employee Share Schemes.

As the Scheme will apply only to Amersham Shares in issue at the Scheme Record Time, it is proposed to amend the Articles of Association of Amersham at the Extraordinary General Meeting to provide that, if the Acquisition completes, any Amersham Shares issued or transferred after the Reclassification Record Time will be automatically transferred to General Electric in exchange for the delivery of New GE Shares by General Electric on the basis of the Exchange Ratio. Consequently, participants in the Amersham Employee Share Schemes who validly exercise any share options or share awards after the Reclassification Record Time will receive New GE Shares from General Electric in the same ratio as under the Scheme plus any cash amount payable under the terms of the Scheme.

Holders of share options and share awards granted under the Amersham Employee Share Schemes will be given the opportunity to release their share options or share awards in return for a cash payment from GE. This payment will be an amount equal to the difference between (i) the aggregate option exercise price for the Amersham Shares to which the holder of options would be entitled upon exercise of his or her options (to the fullest extent permitted at that time under the terms of the relevant share scheme) and (ii) the Final Sterling GE Price for the New GE Shares that would have been delivered to him or her pursuant to the terms of the Acquisition in respect of such Amersham Shares, plus any other cash amount to which such optionholder would have been entitled under the terms of the Scheme. Participants in the relevant Amersham Employee Share Schemes will be provided with further details.

9. Listings, dealings and settlement

Dealings in the New GE Shares on the NYSE and the other relevant exchanges are expected to commence on the Effective Date following registration of the Final Court Order by the Registrar of Companies.

Dealings in Amersham Securities will be suspended with effect from the close of trading on the day prior to the Final Court Hearing. The existing listing of Amersham Shares on the Official List and their admission to trading on the London Stock Exchange’s market for listed securities, the quotation of Amersham ADSs on the NYSE and the quotation of Amersham Shares registered with the VPS in Norway on the Oslo Stock Exchange will all be cancelled with effect from the close of trading on the day of the Final Court Hearing.

On the implementation of the Scheme (and except as provided in Section 16 of this Part 2 in relation to certain overseas Amersham Shareholders), settlement of the New GE Shares to which Amersham Shareholders and registered holders of Amersham ADSs are entitled under the Scheme will be effected in the following manner:

(a) Amersham Shares held in uncertificated form through CREST

To facilitate trading of New GE Shares in uncertificated form for those Amersham Shareholders who hold Amersham Shares in a stock account in CREST at the Scheme Record Time, it is intended that the New GE Shares to which Uncertificated Holders will be entitled will be delivered, held and settled in CREST by means of the CREST International Settlement Links Service, and in particular CRESTCo’s established link with DTCC, the US settlement and clearance system. This link operates via the services of CREST International Nominees, which is a participant in DTCC. Under the CREST International Settlement Links Services, CREST Depository Limited, a subsidiary of CRESTCo, issues dematerialised depository interests representing entitlements to non-UK securities such as GE Shares, called CDIs. CDIs are independent securities constituted under English law, which may be held and transferred through the CREST System.

Accordingly, the New GE Shares to which Uncertificated Holders will be entitled will be delivered to CREST International Nominees’ account at DTCC, and CREST Depository Limited will then issue GE CDIs to Lloyds TSB Registrars Corporate Nominees Limited, who will thereupon deliver, through CREST to the appropriate stock account in CREST of the Uncertificated Holder concerned, such holder’s entitlement to GE CDIs. The stock account concerned will be an account under the same participant ID as the Uncertificated Holder currently has. Following distribution of the GE CDIs, such holders will be entitled to arrange for the transfer of their GE CDIs to other CREST holders, or to another participant in DTCC, if they so wish.

As from the Effective Date, each holding of Amersham Shares credited to any stock account in CREST will be disabled.

The crediting of GE CDIs through CREST will take place no later than the expiry of the period of 14 days from the Effective Date, expected to be 22 April 2004.

GE reserves the right to settle all or any of the New GE Shares referred to in this paragraph (a) for all or any Uncertificated Holder(s) in certificated form in the manner referred to in paragraph (b) below if, for any reason, it wishes to do so.

Amersham Shareholders should note that they will have no rights in respect of New GE Shares or GE CDIs held through CREST against CRESTCo or its subsidiaries. Normal CREST procedures (including timings) apply in relation to any Amersham Shares that are, or are to be, converted from uncertificated to certificated form, or from certificated to uncertificated form prior to completion of the Acquisition (whether any such conversion arises as a result of a transfer of Amersham Shares or otherwise). Holders of Amersham Shares who are proposing to convert any such Amersham Shares are recommended to ensure that such conversions have been completed prior to the Scheme Record Time.

A custody fee, as determined by CRESTCo from time to time, is charged to users for the use of CDIs.

(b) Amersham Shares held in certificated form

Where, at the Scheme Record Time, an Amersham Shareholder holds Amersham Shares in certificated form, the New GE Shares to which such Certificated Holder is entitled will be issued in certificated form. Definitive certificates for New GE Shares will be despatched to Certificated Holders by first-class post (or by such other method as may be approved by the Panel) to the address appearing in the UK register of members of Amersham at the Scheme Record Time and, in the case of joint holders, to the holder whose name stands first in such register in respect of the joint holdings concerned.

Definitive certificates for New GE Shares will be despatched to Certificated Holders not later than the expiry of the period of 14 days from the Effective Date, expected to be 22 April 2004.

On the Effective Date, share certificates for Scheme Shares held in certificated form will cease to be valid and should be destroyed upon receipt of the New GE Shares to which the holder thereof is entitled.

(c) Entitlements to Amersham Shares held through the VPS in Norway

Where, at the Scheme Record Time, an Amersham Shareholder holds an entitlement to Amersham Shares through the VPS in Norway, the New GE Shares to which such holder is entitled will be issued in certificated form in accordance with the procedure set out in paragraph (b) above to the address registered with the VPS.

As from the Effective Date, each entitlement to Amersham Shares held through the VPS in Norway will be disabled.

(d) Amersham ADSs

After the Effective Date, it is expected that the Depositary, at the direction of Amersham, will terminate the Deposit Agreement by sending notice of such termination to the registered holders of Amersham ADSs then outstanding at least thirty days prior to the date fixed in such notice for such termination.

Registered holders of Amersham ADSs other than CEDE & Co will receive the New GE Shares to which they will become entitled by collecting a definitive certificate for New GE Shares from the Settlement Agent upon surrender of their Amersham ADSs in accordance with the terms of the Deposit Agreement. The Settlement Agent will send a letter of transmittal to each such registered holder on or around the Effective Date to inform it how it may surrender its Amersham ADSs.

Definitive certificates for New GE Shares will be available for collection by registered holders of Amersham ADSs other than CEDE & Co not later than the expiry of the period of 14 days from the Effective Date, expected to be 22 April 2004.

The Settlement Agent will transfer the number of New GE Shares to which CEDE & Co will become entitled to CEDE & Co’s account at DTCC not later than the expiry of the period of 14 days from the Effective Date, expected to be 22 April 2004. CEDE & Co will then transfer the number of New GE Shares to which each holder on whose behalf it holds Amersham ADSs is entitled to such holder through the DTCC system.

(e) Cash amounts

Any cash amounts to which holders of Amersham Securities are entitled under the Scheme (subject to any necessary deductions) will be payable as follows:


(i)	if you are an Amersham Shareholder on the UK register, by way of a cheque drawn in sterling;

(ii)	if you hold an entitlement to Amersham Shares through the VPS in Norway, either by way of a cheque drawn in kroner or by way of electronic payment through the VPS; and

(iii)	if you are a registered holder of Amersham ADSs, by way of a cheque drawn in dollars.

Such cheques will be despatched or electronic payment made to the relevant holders of Amersham Securities not later than the expiry of the period of 14 days from the Effective Date, expected to be 22 April 2004.

(f) General

All documents and remittances sent by or to holders of Amersham Securities will be sent at their own risk and will be sent by post to the holder’s address as set out on the relevant shareholder register or register of holders of Amersham ADSs at the Scheme Record Time and, in the case of joint holders, to the holder whose name stands first in such register in respect of the joint holdings concerned.

In relation to New GE Shares to be issued in certificated form, temporary documents of title will not be issued pending the despatch by post of definitive certificates for such New GE Shares as referred to in paragraph (b) above. Pending the issue of definitive certificates for such New GE Shares, former holders of Amersham Securities wishing to register transfers of such New GE Shares will be required to produce their existing Amersham share or ADS certificates to the Settlement Agent. On the registration of any such transfers, the transferee will receive a General Electric share certificate.

Mandates in force at the Effective Date relating to the payment of dividends and other instructions given by Amersham Shareholders will be deemed to be revoked as from the Effective Date, save in respect of the payment of the proposed Amersham dividend expected to be paid on 28 May 2004.

Holders of Amersham Securities will also receive a personalised statement from the Settlement Agent not later than the expiry of the period of 28 days from the Effective Date setting out certain information about the New GE Shares to which they were entitled, including whether, and in what proportions, such shares were delivered by General Electric or GE Investments or both.

GE has confirmed that, except with the consent of the Panel, settlement of the New GE Shares and any other payment which any holder of Amersham Securities is entitled to receive from GE will be implemented in full without regard to any lien, right of set-off, counter claim or other analogous right to which GE may be, or may claim to be, entitled against such holder.

10. Description of the Implementation Agreement

GE and Amersham have entered into an agreement regarding the implementation of the Scheme and the conduct of the business of the Amersham Group in the period up to the Effective Date. Under the Implementation Agreement, a compensatory payment may become due to either GE or Amersham in certain circumstances described more fully in Section 12 of Part 7 (Additional Information) of this document.

The Implementation Agreement provides that it will terminate in a number of circumstances, including if the Scheme does not become effective and if a Competing Proposal is implemented. GE also has certain rights to terminate, and not to proceed with the Acquisition, in respect of a breach of the covenants Amersham has agreed in relation to the conduct of its business in the period up to the Effective Date. These covenants include agreeing to obtain the consent of GE to:


(i)	the acquisition of or disposal of assets in each case above £125 million; the incurring of net indebtedness exceeding £345 million (when aggregated with existing net indebtedness); and the payment of dividends above certain amounts (broadly amounts exceeding the rate of growth in earnings per share by more than 2 per cent. and in any event exceeding 115 per cent. of the aggregate amount of dividends paid in respect of the year ended 31 December 2002); and

(ii)	carrying on business other than in the ordinary course and in all material respects consistently with past practice; making certain changes to its share capital; and taking action which would require Amersham Shareholder approval under Rule 21 of the City Code or under the Listing Rules.

Note 2 on Rule 13 of the City Code, which restricts the ability of an offeror to lapse an offer except where the Panel agrees that the circumstances allowing a condition to be invoked are of material significance to the offeror in the context of the offer, will not apply in respect of breaches of the covenants referred to in paragraph (i) above, but will apply in all other respects.

A summary of certain further provisions of the Implementation Agreement is set out in Section 12 of Part 7 (Additional Information) of this document.

11. Conditions to the Scheme and the Acquisition

The Acquisition will only complete if all the Conditions have been satisfied or waived (where capable of waiver). The Conditions include:


	•	the approval of the Scheme by Amersham Shareholders at the Court Meeting;

	•	the special resolution required to approve and implement the Scheme being duly passed at the Extraordinary General Meeting;

	•	the Implementation Agreement not being terminated in accordance with its terms; and

	•	the Scheme together with the reduction of capital becoming effective.

The Conditions are set out in full in Part 3 (Conditions to the Scheme and the Acquisition) of this document.

12. Description of the New GE Shares

The New GE Shares to be delivered as consideration under the Acquisition will be fully paid (non assessable) and will rank pari passu in all respects with GE Shares in issue at the time the New GE Shares are delivered under the Acquisition. The New GE Shares will rank for any dividend declared or paid by General Electric by reference to a record date on or after the Effective Date. Assuming the

Effective Date is, as expected, 8 April 2004 it is anticipated that the first dividend to which holders of Amersham Securities who receive and retain New GE Shares would be entitled will have a record date in June 2004 and will be paid by General Electric in July 2004. General Electric generally pays dividends quarterly in US dollars. The New GE Shares will be free from all liens, charges, equitable interests, encumbrances and other third party rights and interests of any nature whatsoever.

To the extent necessary, applications will be made for the New GE Shares to be listed on the NYSE, the Boston Stock Exchange and Euronext Paris and to the UK Listing Authority for the New GE Shares to be admitted to the Official List of the UK Listing Authority and to the London Stock Exchange for the New GE Shares to be admitted to trading on its market for listed securities. No application will be made to list the New GE Shares on any other exchanges, including the Oslo Stock Exchange.

A summary of the principal rights attaching to GE Shares and a comparison of the material differences between the rights of Amersham Shareholders and the rights of holders of GE Shares arising from the differences between the corporate laws of England and the State of New York, respectively, and the companies’ respective governing instruments are set out in Part 6 (Information on the GE Shares) of this document.

13. United Kingdom tax

The comments set out below summarise certain UK taxation consequences of the implementation of the Scheme for Amersham Shareholders. They are based on current law and on what is understood to be current Inland Revenue practice. They are intended as a general guide and apply only to Amersham Shareholders who are resident or (if individuals) ordinarily resident for tax purposes in the United Kingdom, who hold their Amersham Shares as an investment and who are the absolute beneficial owners of their Amersham Shares. Any Amersham Shareholders who do not fall into these categories or who are in any doubt as to their taxation position in respect of the Scheme should consult their own professional advisers immediately. Special considerations may also apply to Amersham Shareholders who acquire their Amersham Shares by exercising options.

Except where the context requires otherwise, references below to New GE Shares include references to GE CDIs.

(a) UK tax consequences of the Scheme

Taxation of chargeable gains


(i)	Reclassification of Amersham Shares as A Ordinary Shares or B Ordinary Shares

The reclassification of existing Amersham Shares as A Ordinary Shares or B Ordinary Shares pursuant to the Scheme should not of itself result in any disposal or part disposal of those shares for the purposes of UK taxation of chargeable gains.


(ii)	Cancellation of Amersham Shares which have been reclassified as A Ordinary Shares and receipt of New GE Shares from General Electric

UK rollover relief will be available to Amersham Shareholders in respect of the cancellation, in consideration for New GE Shares received from General Electric, of such of their Amersham Shares as are, prior to their cancellation, reclassified as A Ordinary Shares. Accordingly, for the purposes of UK taxation of chargeable gains, Amersham Shareholders will not be treated as making a disposal of such Amersham Shares. The New GE Shares received from General Electric will be treated as the same asset, and as having been acquired at the same time and for the same consideration, as the Amersham Shares from which they are derived.

The Inland Revenue has granted clearance under section 138 of the Taxation of Chargeable Gains Act 1992 that it is satisfied that the Scheme is being effected for bona fide commercial reasons and does not form part of a scheme or arrangement of which the main purpose, or one of the main purposes, is avoidance of liability to capital gains tax or corporation tax. Accordingly rollover relief as described above will not be disapplied on that ground.

If Amersham Shareholders entitled to rollover as described above receive, in addition to New GE Shares, any cash amount pursuant to the Scheme, such Amersham Shareholders may be regarded to that extent as making a part disposal of their Amersham Shares. Accordingly, depending on their individual circumstances, such Amersham Shareholders may incur a liability to UK taxation of chargeable gains. Part disposal treatment should however not generally apply where the cash amount

received is small as compared to the value of the shareholding to which it relates. “Small” is generally regarded by the Inland Revenue as meaning 5 per cent. or less of the value of the relevant shareholding or the receipt of a cash amount of £3,000 or less (regardless of whether the 5 per cent. or less test would also be met). Instead, in these circumstances, the cash amount will be deducted from the base cost of those New GE Shares received from General Electric (which, where rollover applies, should be the same as the base cost of the Amersham Shares from which those New GE Shares are derived).


(iii)	Cancellation of Amersham Shares which have been reclassified as B Ordinary Shares and receipt of New GE Shares from GE Investments

UK rollover relief will not be available to Amersham Shareholders in respect of the cancellation, in consideration for New GE Shares received from GE Investments, of such of their Amersham Shares as are, prior to their cancellation, reclassified as B Ordinary Shares. Accordingly, the cancellation of such Amersham Shares will result in a disposal of those B Ordinary Shares by Amersham Shareholders for the purposes of UK taxation of chargeable gains, the consideration for such disposal being the market value of the New GE Shares so received plus any additional cash amounts. Such disposal may, depending on a shareholder’s individual circumstances, give rise to a chargeable gain or allowable loss.

For the purposes of UK taxation of chargeable gains, the acquisition cost of the New GE Shares received from GE Investments should be the market value of the Amersham Shares cancelled in consideration for those GE Shares as determined immediately prior to their cancellation, less any additional cash amount received.


(iv)	Election

Amersham Shareholders who would prefer to receive the New GE Shares to which they will be entitled under the Scheme from General Electric, rather than from GE Investments, and accordingly to have their Amersham Shares reclassified as A Ordinary Shares, may elect to do so. Certain limits apply for the purpose of determining the extent to which effect may be given to such elections. Further details on these limits and the procedure for making elections can be found in Section 7 of this Part 2.

Amersham Shareholders will receive a personalised statement from the Settlement Agent not later than the expiry of the period of 28 days from the Effective Date setting out certain information about the New GE Shares to which they were entitled, including whether, and in what proportions, such shares were delivered by General Electric or GE Investments or both.


(v)	General

The Inland Revenue has also confirmed, pursuant to the clearance process provided under section 707 of the Income and Corporation Taxes Act 1988, that certain provisions concerned with the obtaining of a tax advantage in consequence of a transaction or transactions in securities and which might affect the tax treatment outlined above will not be applicable.

Stamp duty and stamp duty reserve tax (“SDRT”)

No SDRT will be payable in respect of the cancellation of the Amersham Shares or the delivery of the New GE Shares by either General Electric or GE Investments to Amersham Shareholders pursuant to the Scheme. In addition, no liability to stamp duty will arise in respect of the cancellation of the Amersham Shares, and Amersham Shareholders should not in practice be required to pay any stamp duty in respect of the delivery to them of the New GE Shares.

(b) Dividends on New GE Shares

UK resident holders of New GE Shares will, in general, be subject to UK income tax or corporation tax on the gross amount of dividends paid on the New GE Shares. Dividends received by UK corporation taxpayers will be taxed at the prevailing corporation tax rate. An individual shareholder will generally be chargeable to income tax on dividends paid on the New GE Shares at the Schedule F ordinary rate (currently 10 per cent.) or, to the extent that his or her income exceeds the threshold for higher rate tax, at the Schedule F upper rate (currently 32.5 per cent.). Credit will be available against income or corporation tax for US tax required to be deducted or withheld from the dividends provided that such credit does not exceed the credit which would have been allowed had all reasonable steps been taken

to minimise such US tax (such steps including any claims which could be made by the relevant holder under the terms of the double taxation treaty between the US and the United Kingdom).

Details of the US withholding tax which will be applied to dividends paid on the New GE Shares, and the conditions (including procedural requirements) which must be met in order for a UK resident holder to benefit from a reduced rate of withholding under the terms of the double taxation treaty between the US and the United Kingdom, may be found in Section 14(b)(ii) of this Part 2.

(c) Subsequent disposals of New GE Shares

(i) Taxation of chargeable gains

A disposal or deemed disposal of New GE Shares may, depending on the shareholder’s individual circumstances (including whether such shareholder benefited from rollover relief in respect of the Scheme: see above) and subject to any available exemptions or reliefs, give rise to a chargeable gain or an allowable loss for the purposes of UK taxation of chargeable gains.

(ii) Stamp duty and SDRT

No SDRT will be payable in respect of any transfer of, or agreement to transfer, the New GE Shares.

No stamp duty will be payable in respect of the paperless transfer of a GE CDI within CREST, or in respect of any other transfer of an interest in the New GE Shares in dematerialised form, for example by way of book entry transfer through the DTCC system. Provided that any instrument of transfer is executed outside the United Kingdom and does not relate to any property situate, or to any matter or thing done or to be done, in the United Kingdom, no stamp duty will be payable in respect of other transfers of the New GE Shares.

14. United States federal tax

The following discussion is a summary of certain US federal income tax considerations relevant to the cancellation of Amersham Shares or Amersham ADSs for the receipt of New GE Shares and the ownership and disposition of New GE Shares. This discussion is based on the current provisions of the Internal Revenue Code of 1986, as amended, its legislative history, applicable existing and proposed Treasury regulations promulgated thereunder, administrative rulings and pronouncements and judicial decisions, as well as on the double taxation treaties between the US and the United Kingdom and the US and Norway, all as of the date hereof, all of which are subject to change possibly on a retroactive basis. The summary is not a complete description of all the tax considerations that may be relevant to a particular holder of Amersham Securities. To the extent the discussion addresses US Holders, the discussion addresses only a US Holder that holds the Amersham Securities and New GE Shares as capital assets and that uses the US dollar as its functional currency. This discussion does not address all aspects of US federal income taxation that may be relevant to any particular holder based on such holder’s individual circumstances. In particular, it does not address the potential application of the alternative minimum tax or the US federal income tax consequences to holders subject to special rules, such as brokers, dealers, traders in securities that elect mark to market treatment, insurance companies, tax-exempt entities, holders of 10 per cent. or more of the GE Shares or the Amersham Shares, or Amersham ADSs representing 10 per cent. or more of the Amersham Shares, persons holding Amersham Shares or Amersham ADSs or New GE Shares as part of a hedge, straddle, conversion, or other integrated financial transaction and US Holders resident or ordinarily resident in the United Kingdom. This discussion does not address the tax consequences to holders that are partnerships for US federal income tax purposes. This discussion does not address any aspect of taxes other than US federal income taxes. A tax ruling has been received from the US Internal Revenue Service (“IRS”) in connection with the share exchange under the Scheme confirming the Acquisition by GE will be treated as a qualified stock purchase. Therefore, the disposition of the Amersham Shares by a US Holder should be a taxable disposition.

Each holder is urged to consult his or her tax adviser about the US federal, state and local income tax and any foreign tax consequences of exchanging Amersham Shares or Amersham ADSs for New GE Shares pursuant to the Acquisition.

As used in this Section 14, “US Holder” means a beneficial owner of Amersham Shares or Amersham ADSs that is for US federal income tax purposes (i) a US citizen or resident, (ii) a corporation organised under the laws of the US, (iii) a trust subject to the control of a US person and the primary supervision of

a US court or (iv) an estate the income of which is subject to US federal income tax regardless of its source. A “Non-US Holder” is a beneficial owner of Amersham Shares or Amersham ADSs that is not a US Holder or a partnership organised under the laws of the United States.

If the obligations contemplated by the Deposit Agreement are performed in accordance with their terms, holders of Amersham ADSs generally will be treated for US federal income tax purposes as the owners of Amersham Shares represented by those Amersham ADSs.

(a) US federal tax consequences of the Scheme

A US Holder should recognise capital gain or loss in the share exchange in an amount equal to the difference between the US dollar value of the New GE Shares received plus any cash received and the US Holder’s tax basis in the Amersham Shares or Amersham ADSs. Any gain or loss generally will be long-term capital gain or loss if the Amersham Shares have been held for more than one year on the Effective Date. Long-term capital gain will be eligible for reduced rates of taxation for individuals and certain non-corporate taxpayers. The deductibility of capital losses is subject to limitations. Any gain or loss will generally be treated as arising from US sources.

Amersham believes, and the discussion in the preceding paragraph assumes, that Amersham is not, and never has been, a passive foreign investment company (“PFIC”). If, notwithstanding this belief and assumption, it is determined that Amersham is or has been a PFIC in any taxable year during which a US Holder has held Amersham Shares or Amersham ADSs (regardless of whether Amersham continues to be a PFIC), any gain realised by such US Holder on the share exchange would be ordinary and would be subject to additional tax. To compute this tax on a gain realised by such US Holder (i) the gain would be allocated rateably over the US Holder’s holding period, (ii) the amount allocated to the current taxable year and to years when Amersham was not a PFIC as to such US Holder would be taxed as ordinary income and (iii) the amount allocated to other taxable years would be taxed at the highest applicable marginal rate in effect for each such taxable year and an interest charge would be imposed to recover the deemed benefit from the deferred payment of the tax attributable to each such year.

Subject to the discussion below on backup withholding, a Non-US Holder will not be subject to US federal income tax or withholding tax on the share exchange unless (i) such gain is effectively connected with the holder’s conduct of a US trade or business (and, if a US double taxation treaty applies, is otherwise attributable to a permanent establishment or fixed base in the US) (“trade or business income”) or (ii) the Non-US Holder is an individual who has been present in the US for at least 183 days in the taxable year of the exchange and does not otherwise qualify for an exception from US tax liability. Trade or business income is taxable on a net basis and corporations with such income may also be subject to US branch profits tax.

Cash proceeds, if any, received from the share exchange pursuant to the Acquisition may be reported to the IRS unless the holder (i) is a corporation, (ii) provides a properly executed IRS Form W-8BEN or (iii) otherwise establishes a basis for exemption. Backup withholding tax may apply to amounts subject to reporting if the holder fails to provide an accurate taxpayer identification number or otherwise establish an exemption. Backup withholding is not an additional tax. The holder can claim a credit against its US federal income tax liability for the amount of any backup withholding tax and a refund of any excess amount provided that certain information is furnished to the IRS.

(b) Dividends on New GE Shares

(i) US Holders

Dividends paid on New GE Shares will be included in the gross income of a US Holder as ordinary income from sources within the US. Dividends may be eligible for the dividends received deduction available to US corporations. Dividends received by non-corporate US Holders will be taxed at the same preferential rate allowed for long-term capital gains if the US Holder meets certain eligibility requirements (including a holding period requirement).

(ii) Non-US Holders

Dividends paid on New GE Shares will be subject to US withholding at a rate of 30 per cent. unless (i) the Non-US Holder is entitled to a reduced rate of withholding because he or she is eligible for the benefits of a double taxation treaty or (ii) the dividends are effectively connected with a trade or business and, if a US double taxation treaty applies, otherwise attributable to a permanent

establishment in the US (in which case, if the Non-US Holder is a foreign corporation, the US branch profits tax may apply) and the Non-US Holder complies with applicable certification and disclosure requirements.

A Non-US Holder eligible for the benefits of the double taxation treaty between the US and the United Kingdom or the double taxation treaty between the US and Norway will generally be subject to withholding on dividends at a reduced rate of 15 per cent. A Non-US Holder that is a pension scheme as defined in the treaty between the US and the United Kingdom and is otherwise eligible for the benefits of that treaty should be exempt from withholding if the dividends are not derived from a business carried on by the pension scheme. A Non-US Holder must certify its residency to General Electric on a properly executed IRS Form W-8BEN to claim the benefits of a treaty. A Form W-8BEN may be obtained through the IRS website at www.irs.gov. As long as the New GE Shares are traded on an established financial market, a Non-US Holder will not be required to provide a US taxpayer identification number on the Form W-8BEN to claim treaty benefits.

If the dividends are effectively connected with a trade or business and, if a treaty applies, are otherwise attributable to a permanent establishment in the US, a Non-US Holder will be subject to US federal income tax on a net basis on the amount of the distribution. In addition, a Non-US Holder that is a corporation may be subject to the US branch profits tax.

(c) Subsequent disposals of New GE Shares

(i) US Holders

A US Holder generally will recognise capital gain or loss on the sale or other disposition of the New GE Shares in an amount equal to the difference between its adjusted tax basis in the New GE Shares and the amount realised from the sale or other disposition. Any gain or loss generally will be long-term capital gain or loss if the holding period in the New GE Shares is more than one year on the date of sale or exchange. Long-term capital gain will be eligible for reduced rates of taxation for individuals and certain non-corporate taxpayers. The deductibility of capital losses is subject to limitations. Any gain or loss generally will be treated as arising from US sources.

(ii) Non-US Holders

Any gain realised by a Non-US Holder on the disposition of New GE Shares will not be subject to US federal income tax unless (i) the gain is effectively connected with the holder’s conduct of a US trade or business and, if a US double taxation treaty applies, is otherwise attributable to a permanent establishment in the US (in which case, if the Non-US Holder is a foreign corporation, the US branch profits tax may apply), (ii) the holder is an individual present in the US for at least 183 days during the taxable year of disposition and certain other conditions are met or (iii) General Electric is or has been a US real property holding company “USRPHC” for US federal income tax purposes unless the Non-US Holder owns actively or constructively less than 5 per cent. or more of the class of shares sold and such class is regularly traded on an established securities market. We believe that General Electric is not and has not been a USRPHC for US federal income tax purposes nor do we anticipate General Electric will become a USRPHC. However, no assurance can be given that General Electric will not become a USRPHC.

(d) Information reporting and backup withholding tax

Dividends from New GE Shares paid to a Non-US Holder will be reported annually to the IRS. Dividends from New GE Shares paid to a US Holder and proceeds from the sale, exchange or other disposition of New GE Shares paid to a US Holder or a Non-US Holder may be reported to the IRS unless the holder (i) is a corporation, (ii) provides a properly executed IRS Form W-8BEN or (iii) otherwise establishes a basis for exemption. Backup withholding tax may apply to amounts subject to reporting if the holder fails to provide an accurate taxpayer identification number or otherwise establish an exemption. Backup withholding tax is not an additional tax. The holder can claim a credit against its US federal income tax liability for the amount of any backup withholding tax and a refund of any excess amount provided that certain information is furnished to the IRS.

15. Norwegian tax

The following is a summary of certain Norwegian tax regulations of relevance to Amersham Shareholders resident in Norway in connection with the Acquisition. The summary is based on current

Norwegian law and practice. The presentation is general in nature and does not discuss all aspects that may be relevant to Amersham Shareholders resident in Norway nor does it aim to provide advice in legal or tax matters. Professional tax advisers should be contacted for advice on individual tax consequences and the applicability and effect of any local or foreign tax laws and of changes in applicable tax laws.

(a) Norwegian tax consequences of the Scheme

Amersham has, on behalf of Amersham Shareholders resident in Norway, applied for and has been granted tax relief whereby Norwegian resident Amersham Shareholders may elect not to be subject to immediate taxation in Norway when the Amersham Shares are cancelled in exchange for New GE Shares under the Acquisition. Each of the Amersham Shareholders resident in Norway is free to elect to make use of the tax relief.

(i) Without tax relief

A share exchange (whether or not by way of a cancellation scheme) is considered a realisation of shares for Norwegian tax purposes. Accordingly, Amersham Shareholders resident in Norway for tax purposes will be liable for tax in respect of capital gains arising upon the cancellation of Amersham Shares in exchange for New GE Shares under the Scheme. Correspondingly, losses are tax deductible in Norway.

The taxable gain or loss is equal to the sales price adjusted for transaction expenses, less the tax base on the Amersham Shares. The sales price will be equal to the fair market value of the New GE Shares received plus any cash payments made. The tax base of the Amersham Shares will be equal to the acquisition price. Amersham Shareholders who were shareholders in Nycomed ASA before the merger of Nycomed ASA and Amersham International PLC in 1997, and who utilised the tax relief granted by the Norwegian Ministry of Finance in connection with the merger, will have a tax base in their Amersham Shares equal to their original tax base in their Nycomed ASA shares.

The taxable gain or loss is included in or deducted from the basis for computation of general income in the year of disposal, taxed at a flat rate of 28 per cent.

Any gain obtained upon realisation of Amersham Shares by a person who is not resident in Norway for tax purposes is normally not subject to taxation in Norway and a loss is not tax deductible, unless such Amersham Shares are effectively connected to business activities that are subject to tax in Norway.

(ii) With tax relief

The tax relief has been granted on the following conditions (summarised from an unofficial translation of the conditions into English):


(A)	the tax base of the New GE Shares when determining the gain or loss on any subsequent sale or other disposition of the New GE Shares shall be equal to the tax base of the Amersham Shares at the time when the Amersham Shares are cancelled in exchange for New GE Shares. The time of acquisition and tax bases shall be distributed proportionately on the New GE Shares received as consideration, in accordance with the Norwegian Tax Act section 10-36;

(B)	on repayment of share capital related to the New GE Shares, any amount exceeding the tax base of the New GE Shares received as consideration (see (A) above) shall be taxed as a dividend for the Amersham Shareholders;

(C)	of the total consideration provided to the Amersham Shareholders, at least 80 per cent. must be provided in the form of New GE Shares. The tax relief does not apply to any cash payments made;

(D)	gains arising upon a sale or other disposition of the New GE Shares shall be taxable in Norway according to Norwegian tax law, without a deduction for any foreign tax paid in respect of the sale or disposition. In the event that a sale or other disposition by a Norwegian resident Amersham Shareholder of the New GE Shares is taxable in the US according to the double taxation treaty between the US and Norway, the following alternative condition shall apply: on a sale or other disposition of the New GE Shares received as consideration a proportionate part of the gain realised in the Acquisition, to which this tax relief relates, shall become taxable for the shareholder;


(E)	shareholders who move permanently abroad or cease to be resident in Norway will be deemed to dispose of their New GE Shares under the Norwegian Tax Act section 2-2 and the Norwegian Tax Assessment Act section 4-7 Nos 6 and 7; and

(F)	an Amersham Shareholder wishing to claim the tax relief must submit a written declaration to his or her local tax office confirming that the conditions of this tax relief are accepted. This declaration must be submitted together with the tax return for the income year in which the Acquisition is completed. The declaration must include a table showing the shareholder’s tax base and estimated gain on the shares according to the generally applicable rules and also the shareholder’s birth and identity number or organisation number.

For Norwegian resident Amersham Shareholders who do not elect to claim the tax relief, the tax position will be as described under paragraph (i) above.

(iii) Duties on exchange of shares

No stamp duties or similar taxes are currently imposed in Norway on the issue or transfer of shares, whether on acquisition or disposal.

(b) Dividends on New GE Shares

Following the Effective Date, dividends paid by General Electric and received by shareholders of General Electric resident in Norway will be subject to taxation in Norway as general income at a flat rate, currently 28 per cent.

Details of the US withholding tax which will be applied to dividends paid on the GE shares, and the conditions (including procedural requirements) which must be met in order for a Norwegian resident holder to benefit from a reduced rate of withholding under the terms of the tax treaty between the US and Norway, may be found in Section 14(b)(ii) of this Part 2.

A shareholder of General Electric resident in Norway may be entitled to a foreign tax credit in respect of US withholding applied to dividends paid on the New GE Shares, which may be set off against that shareholder’s Norwegian income tax liability on the dividends. In order to claim such a tax credit, the Norwegian shareholder must submit form RF-1147 (individuals) or RF-1145 (companies) to their local tax office together with their Norwegian tax return for the relevant period. These forms may be obtained through the Norwegian Tax Administration website www.skatteetaten.no. In the relevant form, the shareholder must specify the amount of dividend received, the amount of US withholding tax deducted and the applicable exchange rate.

(c) Subsequent disposals of New GE Shares

Sale, redemption or other disposal of shares is considered a realisation for Norwegian tax purposes. A gain or loss generated through a future realisation of New GE Shares will be taxable or tax deductible in Norway, if the shareholder disposing of the New GE Shares is resident in Norway for tax purposes. Such capital gain or loss is included in or deducted from the basis for computation of general income in the year of disposal, taxable at a flat tax rate of 28 per cent. The gain is subject to tax and the loss is deductible irrespective of the duration of the ownership and the number of shares disposed of.

The taxable gain or loss is equal to the sales price adjusted for transaction expenses, less the tax base on the New GE Shares. For those shareholders who have not utilised the tax relief granted by the Ministry of Finance (as described above), the tax base of the New GE Shares will be the fair market value of the New GE Shares used for the purpose of computing gains or losses on the exchange of Amersham Shares pursuant to the Acquisition. Those Amersham Shareholders who have utilised the tax relief granted by the Ministry of Finance will have a tax base in their New GE Shares equal to the tax base of the Amersham Shares owned before the Acquisition.

Shareholders not resident in Norway for tax purposes are normally not subject to tax in Norway on capital gains, and losses are not deductible upon realisation of shares, unless the shareholder is carrying on business activities that are subject to tax in Norway and such shares are or have been effectively connected with such business activities.

16. Overseas shareholders

The implications of the Acquisition for persons resident in, or citizens of, jurisdictions outside the United Kingdom, the US and Norway (“Overseas Shareholders”) may be affected by the laws of the relevant

jurisdiction. Such Overseas Shareholders should inform themselves about and observe any applicable legal requirements. It is the responsibility of each Overseas Shareholder to satisfy himself or herself as to the full observance of the laws of the relevant jurisdiction in connection therewith, including the obtaining of any governmental, exchange control or other consents which may be required and the payment of any issue, transfer or other taxes due in such jurisdiction.

In any case where GE is advised that the delivery of New GE Shares would or may infringe the laws of any jurisdiction outside the United Kingdom, the US or Norway or would or may require GE to comply with an impossible or unduly onerous requirement, the Scheme provides that such New GE Shares may, at the discretion of GE, either (i) be delivered to a nominee and then sold or (ii) delivered to the relevant Overseas Shareholder and sold on his or her behalf, in each case with the net proceeds of sale being remitted to the Overseas Shareholder. In such circumstances, any election to receive New GE Shares from General Electric made by such Overseas Shareholder will be void and the Amersham Shares held by such Overseas Shareholder will as part of the Scheme be reclassified as B Ordinary Shares. Amersham Shareholders resident in Sweden (with the exception of those acquiring Amersham Shares on exercise of options) will not receive New GE Shares but will instead receive the net cash proceeds following the sale of their entitlement to such shares.

This document and the accompanying documents have been prepared for the purpose of complying with (i) English law, the City Code and the applicable rules of the UK Listing Authority and the London Stock Exchange, (ii) the applicable requirements of the US federal and state securities laws and the applicable rules and regulations of the NYSE (except to the extent exempt from such requirements) and (iii) the applicable Norwegian rules and regulations. This document and the Conditions and further terms set out in this document are governed by English law and are subject to the jurisdiction of the English courts. Therefore, the information disclosed in this document may not be the same as that which would have been disclosed if this document had been prepared for the purpose of complying with the registration requirements of the Securities Act or in accordance with the laws and regulations of any other jurisdiction.

(a) United States

The delivery of New GE Shares to Amersham Shareholders and holders of Amersham ADSs under the Scheme has not been and will not be registered under the Securities Act in reliance upon the exemption from the registration requirements of the Securities Act provided by section 3(a)(10). Such GE Shares should not be treated as “restricted securities” within the meaning of Rule 144(a)(3) under the Securities Act and may be resold by former holders of Amersham Shares or Amersham ADSs (other than certain affiliates as described below) without restriction under the Securities Act.

For the purpose of establishing the exemption from the registration requirements of the Securities Act provided by section 3(a)(10) thereof, Amersham will advise the Court at the Initial Court Hearing that its sanctioning of the Scheme will be relied upon by GE for such purpose as an approval of the Scheme following a hearing on the fairness of the terms and conditions of the Scheme to Amersham Shareholders, at which hearing all such holders are entitled to attend in person or through counsel to support or oppose the sanctioning of the Scheme and with respect to which adequate notification has been given to all such holders.

Under US federal securities laws, an Amersham Shareholder or holder of Amersham ADSs who is an affiliate of GE or Amersham prior to, or will be an affiliate of GE after, the Effective Date will be subject to certain US transfer restrictions relating to New GE Shares received under the Scheme. Such New GE Shares may not be sold without registration under the Securities Act, except pursuant to the applicable resale provisions of Rule 145(d) under the Securities Act or in a transaction not subject to such requirements (including a transaction that satisfies the applicable requirements for resales outside the US pursuant to Regulation S under the Securities Act). Whether a person is an affiliate of a company for such purposes depends upon the circumstances, but affiliates of a company can include certain officers and directors and significant shareholders. An Amersham Shareholder or holder of Amersham ADSs who believes that he or she may be an affiliate of GE or Amersham should consult his or her own legal advisers prior to any sales of New GE Shares received pursuant to the Scheme.

(b) Canada

By receipt of this document, holders of Amersham Securities in Québec, Canada are deemed to have confirmed that they have expressly requested that this document and all other documents relating in

any way to the securities described herein (including any supplement, election or notice) be drawn up in the English language only.

The following statement is a direct translation of the previous sentence into French.

“Par la réception du présent document, les actionnaires québécois sont réputés avoir confirmé qu’ils ont expressément demandé que le présent document et tous les autres documents ayant trait de quelque façon que ce soit aux titres décrits aux présentes (y compris dans tout supplément, choix ou avis) soient rédigés en anglais seulement.”

The New GE Shares being delivered to holders of Amersham Securities who reside in a province of Canada are being delivered under an exemption from the registration and prospectus requirements of Canadian provincial securities laws. Such laws require the first trade in the shares to be made through an exchange, or a market, outside of Canada or to a person or company outside of Canada or otherwise on a prospectus exempt basis under such laws. In addition, when selling the shares, holders resident in a province of Canada must use a dealer appropriately registered in such province or rely on an exemption from the registration requirements of such province. If a holder requires advice on any applicable prospectus or registration exemption, that holder should consult his or her own independent professional adviser.

Yours faithfully,



For and on behalf of J.P. Morgan plc Bernard Taylor, Vice Chairman		For and on behalf of Morgan Stanley & Co. Limited Michael Tory, Managing Director

PART 3

CONDITIONS TO THE SCHEME AND THE ACQUISITION

The Acquisition complies with the applicable rules and regulations of the UK Listing Authority, the London Stock Exchange and the City Code. The Acquisition is governed by English law and is subject to the jurisdiction of the English courts and to the terms and conditions set out below. In addition, the Acquisition is subject to the applicable requirements of the United States federal and state securities laws and applicable rules and regulations of the NYSE (except to the extent exempt from such requirements) as well as the applicable Norwegian rules and regulations. Unless otherwise agreed between GE and Amersham prior to the Final Court Hearing and subject to the approval of the Court, all of the Conditions must have been satisfied or waived (if capable of waiver) by the Final Hearing Date save for Condition (c) below requiring the confirmation by the Court of the reduction of capital involved in the Scheme and the registration of an office copy of the Final Court Order by the Registrar of Companies.


1.	The Acquisition and the Scheme are subject to the following Conditions:


	(a)	approval of the Scheme by a majority in number, representing 75 per cent. or more in value present and voting, either in person or by proxy, at the Court Meeting, or at any adjournment of the Court Meeting;

	(b)	the resolution(s) required to approve and implement the Scheme being duly passed by the requisite majority at the Extraordinary General Meeting, or at any adjournment of the Amersham EGM;

	(c)	sanction (with or without modifications, on terms reasonably acceptable to GE) of the Scheme and confirmation of the reduction of capital involved therein by the Court and office copies of the order of the Court sanctioning the Scheme and of the order of the Court confirming the reduction of capital involved in the Scheme being delivered for registration to the Registrar of Companies in England and Wales and being registered by him;


	(d) (i)	the approval for listing on the NYSE, subject to official notice of issue, of the New GE Shares; and


	(ii)	admission of the New GE Shares to listing on the Official List and to trading on the London Stock Exchange’s market for listed securities becoming effective (or, if GE so determines and subject to the consent of the Panel, the UK Listing Authority and the London Stock Exchange agreeing to admit such shares to listing and trading respectively);


	(e) (i)	all necessary notifications, filings or applications having been made in connection with the Acquisition and all statutory or regulatory obligations in any jurisdiction having been complied with in connection with the Acquisition or the acquisition or proposed acquisition by any member of the Wider GE Group of any shares or other securities (or the equivalent) in, or control of, Amersham by GE or any member of the Wider GE Group;


	(ii)	all authorisations, orders, recognitions, grants, consents, licences, confirmations, clearances, permissions and approvals (collectively “Consents”) deemed necessary by GE for or in respect of the Acquisition or the acquisition or the proposed acquisition of any shares or other securities (or the equivalent) in, or control of, Amersham by GE or by any member of the Wider GE Group having been obtained in terms and in a form satisfactory to GE from all appropriate Third Parties or persons with whom any member of the Wider Amersham Group has entered into contractual arrangements; and


	(iii)	all such Consents together with all Consents necessary to carry on the business of any member of the Wider Amersham Group having been obtained and remaining in full force and effect and all filings necessary for such purpose having been made and there being no notice or intimation of any intention to revoke, suspend, restrict, modify or not to renew any of the same at the time at which the Acquisition becomes otherwise unconditional;


	(f)	there being no provision of any agreement, arrangement, licence, permit, lease or other instrument to which any member of the Wider Amersham Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, or any circumstance which, in each case as a consequence of the Acquisition or the acquisition or the proposed acquisition of any shares or other securities (or the equivalent) in Amersham or of a change in the control or management of the Wider Amersham Group or otherwise, would or might reasonably be expected to result in, in any case, to the extent which is material in the context of the Wider Amersham Group taken as a whole:


	(i)	any moneys borrowed by or any other indebtedness (actual or contingent) of, or grant available to any such member, being or becoming repayable or capable of being declared repayable immediately or earlier than their or its stated maturity date or repayment date or the ability of any such member to borrow moneys or incur any indebtedness being withdrawn or inhibited or being capable of becoming or being withdrawn or inhibited;

	(ii)	any such agreement, arrangement, licence, permit, lease or instrument, or the interests or business of any such member in or with, any person, firm or body (or any agreement or arrangements relating to any such interest or business) or the rights, liabilities, obligations or interests of any such member thereunder being terminated or modified or affected or any onerous obligation or liability arising or any adverse action being taken or arising thereunder;

	(iii)	any assets or interests of any such member being or falling to be disposed of or charged or any right arising under which any such asset or interest could be required to be disposed of or charged or could cease to be available to any such member, in each case, other than in the ordinary course of business;

	(iv)	the creation or enforcement of any mortgage, charge or other security interest over the whole or any part of the business, property or assets of any such member;

	(v)	the value of any such member or its financial or trading position being prejudiced or adversely affected;

	(vi)	any such member ceasing to be able to carry on business under any name under which it presently does so; or

	(vii)	the creation of any liability, actual or contingent, by any such member,

and no event having occurred which, under any provision of any agreement, arrangement, licence, permit, lease or other instrument to which any member of the Wider Amersham Group is a party or by or to which any such member or any of its assets may be bound, entitled or subject, could result in any of the events or circumstances as are referred to in sub-paragraphs (i) to (vii) inclusive of this Condition (f);


	(g)	no Third Party having decided to take, institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference, or having required any action to be taken or otherwise having done anything or having enacted, made or proposed any statute, regulation, decision or order and there not continuing to be outstanding any statute, regulation, decision or order which would or might reasonably be expected, in any case, to an extent which is material in the context of the Wider GE Group or the Wider Amersham Group (as the case may be) taken as a whole:


	(i)	require, prevent or delay the divestiture, or alter the terms envisaged for any proposed divestiture by any member of the Wider GE Group or any member of the Wider Amersham Group of all or any portion of their respective businesses, assets or property or impose any limitation on the ability of any of them to conduct their respective businesses (or any of them) or to own any of their respective assets or properties or any part thereof;

	(ii)	require, prevent or delay the divestiture by any member of the Wider GE Group of any shares or other securities (or the equivalent) in Amersham;

	(iii)	impose any limitation on, or result in a delay in, the ability of any member of the Wider GE Group or of the Wider Amersham Group, directly or indirectly, to acquire


		or to hold or to exercise effectively any rights of ownership in respect of shares or loans or securities convertible into shares or any other securities (or the equivalent) in any member of the Wider Amersham Group or the Wider GE Group or to exercise management control over any such member;

	(iv)	otherwise adversely affect the business, assets or profits of any member of the Wider GE Group or of any member of the Wider Amersham Group;

	(v)	make the Acquisition, its implementation or the acquisition or proposed acquisition by GE or any member of the Wider GE Group of any shares or other securities (or the equivalent) in, or control of, Amersham void, illegal, and/or unenforceable in or under the laws of any relevant jurisdiction, or otherwise, directly or indirectly, restrain, restrict, prohibit, delay or otherwise interfere with the implementation of, or impose additional conditions or obligations with respect to, or otherwise challenge or interfere with or require amendment of, the Acquisition or the acquisition by GE of any shares or other securities (or the equivalent) of Amersham;

	(vi)	require any member of the Wider GE Group or the Wider Amersham Group to offer to acquire any shares or other securities (or the equivalent) or interest in any member of the Wider Amersham Group (other than Amersham) or the Wider GE Group owned by any third party;

	(vii)	impose any limitation on the ability of any member of the Wider Amersham Group or the Wider GE Group to integrate or co-ordinate its business, or any part of it, with all or any part of the businesses of any other member of the Wider Amersham Group and/or the Wider GE Group; or

	(viii)	result in any member of the Wider Amersham Group ceasing to be able to carry on business under any name under which it presently does so,

and all applicable waiting and other time periods (including any extensions thereof) during which any such Third Party could institute, implement or threaten any action, proceeding, suit, investigation, enquiry or reference or any other step under the laws of any jurisdiction in respect of the Acquisition or the acquisition or proposed acquisition of any shares or other securities (or the equivalent) having expired, lapsed or been terminated;


	(h)	except as disclosed in the Amersham Annual Report and Accounts or the Amersham Interim Results or as otherwise publicly announced by or on behalf of Amersham (by the delivery of an announcement to a Regulatory Information Service as specified in the Listing Rules) prior to 10 October 2003 or as otherwise fairly disclosed to GE in writing by or on behalf of Amersham prior to 10 October 2003, no member of the Wider Amersham Group having, since 31 December 2002:


	(i)	save as between Amersham and wholly-owned subsidiaries of Amersham or for the Amersham Shares issued pursuant to the exercise of options granted prior to 10 October 2003 under the Amersham Employee Share Schemes, issued or agreed to issue, authorised or proposed the issue of additional shares of any class save to the extent the same is not material in the context of the Acquisition;

	(ii)	save as between Amersham and wholly-owned subsidiaries of Amersham, issued or agreed to issue, authorised or proposed the issue of securities convertible into shares of any class or rights, warrants or options to subscribe for, or acquire, any such shares or convertible securities save to the extent the same is not material in the context of the Acquisition;

	(iii)	other than to another member of the Amersham Group and save as provided in the Implementation Agreement, recommended, declared, paid or made or proposed to recommend, declare, pay or make any bonus, dividend or other distribution whether payable in cash or otherwise;

	(iv)	save for intra-Amersham Group transactions, merged with or demerged from any body corporate or acquired or disposed of or transferred, mortgaged or charged or created any security interest over or leased or licensed any assets or any right, title or interest in any asset (including shares and trade investments) or authorised or


		proposed or announced any intention to propose any merger, demerger, acquisition or disposal, transfer, mortgage, charge, security interest, lease or licence, in each case save in the ordinary course of business or to the extent the same is not material in the context of the Wider Amersham Group taken as a whole;

	(v)	save for intra-Amersham Group transactions, made or authorised or proposed or announced an intention to propose any change in its loan capital save to the extent the same is not material in the context of the Wider Amersham Group taken as a whole;

	(vi)	save for intra-Amersham Group transactions, issued, authorised or proposed the issue of any debentures or incurred or increased any indebtedness or become subject to any guarantee or other contingent liability save to the extent the same is not material in the context of the Wider Amersham Group taken as a whole;

	(vii)	purchased, redeemed or repaid or announced any proposal to purchase, redeem or repay any of its own shares or other securities or reduced or, save in respect to the matters mentioned in sub-paragraph (i) above, made any other change to any part of its share capital save to the extent the same is not material in the context of the Wider Amersham Group taken as a whole;

	(viii)	implemented, or authorised, proposed or announced its intention to implement, any reconstruction, amalgamation, scheme, commitment or other transaction or arrangement otherwise than in the ordinary course of business, save to the extent the same is not material in the context of the Wider Amersham Group taken as a whole, or, save in respect of normal annual salary increases in accordance with past remuneration policies, entered into or changed or made any offer (which remains open for acceptance) to enter into or change the terms of any contract with any director or senior executive;

	(ix)	entered into or changed or authorised, proposed or announced its intention to enter into or change any contract, transaction or commitment (whether in respect of capital expenditure or otherwise) which is of a long term, onerous or unusual nature or magnitude or which is or might reasonably be expected to be restrictive on the businesses of any member of the Wider Amersham Group or the Wider GE Group or which involves or could involve an obligation of such a nature or magnitude or which is other than in the ordinary course of business and which, in any case, has a material adverse effect on the Wider Amersham Group or the Wider GE Group (as the case may be) taken as a whole;

	(x)	(other than in respect of a member which is dormant and was solvent at the relevant time) taken any corporate action or had any legal proceedings started or threatened against it for its winding-up, dissolution or reorganisation or for the appointment of a receiver, administrative receiver, administrator, trustee or similar officer of all or any of its assets or revenues or any analogous proceedings in any jurisdiction or had any such person appointed save to the extent the same is not material in the context of the Wider Amersham Group taken as a whole;

	(xi)	been unable, or admitted in writing that it is unable, to pay its debts or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business save to the extent the same is not material in the context of the Wider Amersham Group taken as a whole;

	(xii)	waived, settled or compromised any claim otherwise than in the ordinary course of business save to the extent the same is not material in the context of the Wider Amersham Group taken as a whole;

	(xiii)	made any alteration to its memorandum or articles of association or other incorporation documents or, except for any change required by reason of a concurrent change in applicable law, regulation or generally accepted accounting practice, to any method of accounting or accounting practice used by it on


		10 October 2003 and which, in any case, is materially adverse in the context of the Wider Amersham Group taken as a whole;

	(xiv)	amended the terms (including terms relating to acceleration of vesting) of any of the Amersham Employee Share Schemes in a manner which is materially adverse in the context of the Wider Amersham Group taken as whole;

	(xv)	entered into or varied any contract, commitment, arrangement or agreement otherwise than in the ordinary course of business, or passed any resolution or made any offer (which remains open for acceptance) with respect to or announced any intention to, or proposed to, effect any of the transactions, matters or events referred to in this Condition;


	and, for the purposes of sub-paragraphs (iii), (iv), (v) and (vi) of this Condition (h) only, the term “Amersham Group” shall mean Amersham and its wholly-owned subsidiaries;


	(i)	since 31 December 2002, and save as disclosed in the Amersham Annual Report and Accounts or the Amersham Interim Results or as otherwise publicly announced by or on behalf of Amersham (by the delivery of an announcement to a Regulatory Information Service as specified in the Listing Rules) prior to 10 October 2003 or as otherwise fairly disclosed to GE in writing by or on behalf of Amersham prior to 10 October 2003:


	(i)	no material adverse change or deterioration having occurred in the business, assets, financial or trading position or profits of the Wider Amersham Group taken as a whole;

	(ii)	no litigation, arbitration proceedings, prosecution or other legal proceedings to which any member of the Wider Amersham Group is or may become a party (whether as a plaintiff, defendant or otherwise) and no enquiry or investigation by or complaint or reference to any Third Party against or in respect of any member of the Wider Amersham Group having been instituted announced or threatened by or against or remaining outstanding in respect of any member of the Wider Amersham Group which in any such case might be expected to adversely affect any member of the Wider Amersham Group to an extent which, in any case, is material in the context of the Wider Amersham Group taken as a whole;

	(iii)	no contingent or other liability having arisen or become apparent to GE which would be likely to adversely affect any member of the Wider Amersham Group to an extent which, in any case, is material in the context of the Wider Amersham Group taken as a whole; and

	(iv)	no steps having been taken which are likely to result in the withdrawal, cancellation, termination or modification of any licence held by any member of the Wider Amersham Group which is necessary for the proper carrying on of its business to an extent which, in any case, is material in the context of the Wider Amersham Group taken as a whole;


	(j)	GE not having discovered:


	(i)	that any financial, business or other information concerning the Wider Amersham Group publicly disclosed by Amersham or disclosed to GE at any time by or on behalf of any member of the Wider Amersham Group prior to 10 October 2003 is misleading, contains a misrepresentation of fact or omits to state a fact necessary to make that information not misleading to an extent which, in any case, is material in the context of the Wider Amersham Group taken as a whole;

	(ii)	that any member of the Wider Amersham Group is subject to any liability (contingent or otherwise) save to an extent the same is not material in the context of the Wider Amersham Group taken as a whole which is not disclosed in the Amersham Annual Report and Accounts or the Amersham Interim Results or as otherwise publicly announced by or on behalf of Amersham (by the delivery of an announcement to a Regulatory Information Service as specified in the Listing Rules) prior to 10 October 2003 or as otherwise fairly disclosed to GE in writing by or on behalf of Amersham prior to 10 October 2003; or


	(iii)	any information which affects the import of any information disclosed at any time by or on behalf of any member of the Wider Amersham Group;


	(k)	GE not having discovered that:


	(i)	any past or present member of the Wider Amersham Group has failed to comply with any and/or all applicable legislation or regulation, of any jurisdiction with regard to the use, treatment, handling, storage, transport, disposal, spillage, release, discharge, leak or emission of any waste or hazardous substance or any substance likely to impair the environment or harm human health or animal health or otherwise relating to environmental matters or the health and safety of any person, or that there has otherwise been any such use, treatment, handling, storage, transport, disposal, spillage, release, discharge, leak or emission (whether or not the same constituted a non-compliance by any person with any such legislation or regulations, and wherever the same may have taken place) which, in any case, would be likely to give rise to any liability (actual or contingent) or cost on the part of any member of the Wider Amersham Group in any case to an extent which is material and adverse in the context of the Wider Amersham Group taken as a whole;

	(ii)	there is, or is reasonably likely to be, for that or any other reason whatsoever, any liability (actual or contingent) of any past or present member of the Wider Amersham Group which is material in the context of the Wider Amersham Group taken as a whole to make good, repair, reinstate or clean up any property or any controlled waters now or previously owned, occupied, operated or made use of or controlled by any such past or present member of the Wider Amersham Group, under any environmental legislation, regulation, notice, circular or order of any government, governmental, quasi- governmental, state or local government, supranational, statutory or other regulatory body, agency, court, association or any other person or body in any jurisdiction; or

	(iii)	there is, or is reasonably likely to be, any person or class of persons proposing to bring a claim which is material in the context of the Wider Amersham Group taken as a whole against any past or present member of the Wider Amersham Group in respect of, or there is, or is reasonably likely to be, any liability (actual or contingent) of any past or present member of the Wider Amersham Group which is material in the context of the Wider Amersham Group taken as a whole as a result of or relating to, any material, chemical, product or process now or previously held, used, sold, manufactured, carried out, under development or research; and


	(l)	the Implementation Agreement not having been terminated in accordance with its terms.

For the purposes of these Conditions the “Wider Amersham Group” means Amersham and its subsidiary undertakings, associated undertakings and any other undertaking in which Amersham and/or such undertakings (aggregating their interests) have a significant interest and the “Wider GE Group” means General Electric and its subsidiary undertakings, associated undertakings and any other undertaking in which General Electric and/or such undertakings (aggregating their interests) have a significant interest, and for these purposes “subsidiary undertaking”, “associated undertaking” and “undertaking” have the meanings given by the Companies Act, other than paragraph 20(1)(b) of Schedule 4A of the Companies Act which shall be excluded for this purpose, and “significant interest” means a direct or indirect interest in 20 per cent. or more of the equity share capital (as defined in the Companies Act) of any undertaking.


2.	GE reserves the right (but shall be under no obligation) to waive, in whole or in part, all or any of the above Conditions, except Conditions (a), (b), (c) and (d). GE shall be under no obligation to waive or treat as fulfilled any of Conditions (e) to (l) inclusive by a date earlier than the date specified or referred to above for the fulfilment thereof notwithstanding that the other Conditions may at any date earlier than such date have been fulfilled and that there are at such earlier date no circumstances indicating that any of such Conditions may not be capable of fulfilment.

3.	If GE is required by the Panel to make an offer for the Amersham Shares (including Amersham Shares represented by Amersham ADSs) under the provisions of Rule 9 of the City Code, GE may make such alterations to the terms and conditions of the Acquisition as are necessary to comply with the provisions of that Rule.

PART 4

FINANCIAL INFORMATION ON THE AMERSHAM GROUP

The information set out in Section 1 of this Part 4 has been extracted, without adjustment, from the text of the preliminary unaudited results for the year ended 31 December 2003, which were announced on 17 February 2004.

The financial information set out in Section 3 of this Part 4 for the year ended 31 December 2002 has been extracted, without material adjustment, from the audited consolidated statutory accounts of Amersham for the year ended 31 December 2002 (the “2002 accounts”). The financial information for the year ended 31 December 2001 has been extracted, without material adjustment, from the comparatives set out in the 2002 accounts. These comparatives were restated in the 2002 accounts following the adoption of FRS 19 Deferred Taxation. The financial information for the year ended 31 December 2000 has been extracted, without material adjustment, from the comparatives set out in the audited consolidated statutory accounts of Amersham for the year ended 31 December 2001 (the “2001 accounts”). These comparatives were restated in the 2001 accounts following the adoption of FRS 18 Accounting Policies, but have not been restated for the subsequent adoption of FRS 19 Deferred Taxation.

The financial information contained in this Part 4 does not constitute statutory accounts within the meaning of section 240 of the Companies Act. The statutory accounts for Amersham for each of the three years ended 31 December 2002 have been delivered to the Registrar of Companies pursuant to section 242 of the Companies Act. The auditors reports on the consolidated statutory accounts for each of the three years ended 31 December 2002 were unqualified and did not contain a statement under section 237(2) or (3) of the Companies Act.

References in this Part 4 to the “Group” or “group” are to the Amersham Group.


1.	Preliminary unaudited results for the year ended 31 December 2003

Amersham business performance exceeds targets delivering double digit

growth in operating profits and EPS, driven by strong second half

FINANCIAL OVERVIEW

The business performance and statutory results are summarised below and the commentary and tables which follow are on a business performance basis unless otherwise stated. Business performance results are stated before exceptional items and goodwill amortisation unless otherwise noted. Management believes that exclusion of these items provides a better comparison of business performance for the periods presented. All growth rates are stated at constant exchange rates (CER) unless otherwise noted.

^#Denotes ongoing business growth excluding discontinued products.
*Turnover including share of joint venture

Business performance and highlights

Growth at

Constant

12 months to

Exchange

31 Dec 2003

31 Dec 2002

Rates

£m

Sales*

1,652

1,618

6^#

Operating profit

299

310

Profit before tax

294

301

EPS

29.0p

29.9p

Dividend per share

8.77p

7.80p


•	Sales up 6%^# to £1,652 million, profit before tax up 14% at £294 million, earnings per share up 13% and dividend per share up 12%

•	Medical Diagnostics sales (excluding Japan) up 11% to £788 million:


	—	Visipaque^TM sales accelerated to £122 million up 38%

	—	Patented product sales up 22% to £412 million, with 5-year CAGR of 22%

	—	Seven products in phase III trials, on track for launch in 2005/06


•	Protein Separations sales up 5% to £295 million:


	—	Stronger growth driven by Laboratory Separations up 14% in second half of 2003

	—	Significant number of products ready for launch in 2004/05 as a result of increased R&D spend


•	Discovery Systems sales up 2%^# to £384 million:


	—	14% sales growth from the strategic focus areas; including protein analysis, cellular bioassays and microarrays (Codelink^TM)

	—	Restructuring ahead of plan delivering over £20 million of cost savings in 2003 moving the business into profit in the second half; with revised expectations of annual savings running at the rate of more than £40 million per annum by the end of 2004


•	Adverse impact of foreign exchange on profit before tax of £39 million

•	Operating cash flow of £322 million


	—	Net debt at £147 million reduced by £35 million in the year

Statutory results

Growth/

(Reduction)

at Actual

12 months to

Exchange

31 Dec 2003

31 Dec 2002

Rates

£m

Sales*

1,652

1,618

Profit before tax

192

264

(27

)

EPS

16.5p

26.1p

(37

)


•	Statutory profit before tax shows a decline at actual exchange rates after exceptional items of £58 million (2002, £nil) and after goodwill amortisation of £44 million (2002, £37 million)

Sir William Castell, Chief Executive, Amersham plc, said, “Our strong results in the second half of 2003 reflect unwavering focus on our business fundamentals. We continued to expand sales of our patented Medical Diagnostics products at an excellent rate; delivered stronger second half growth in Protein Separations, moved Discovery Systems into profit in the second half, ahead of schedule, and we delivered improved underlying margins for Amersham.”

“Since 1990, Amersham has produced an average annual earnings per share growth on a business performance basis of 17 per cent. Our strategic focus on enabling personalised medicine has given our people a strong sense of purpose, and they have applied their skills successfully to provide our customers with a range of innovative products and technologies. The creation of GE Healthcare will enable us to combine expertise in diagnostics, biology, engineering and informatics. By focusing the scale, brand and competencies of the combined businesses on improved diagnosis, we will have an excellent opportunity to transform global healthcare ensuring a better quality of life for the individual and a more cost effective delivery for payers and providers.”

“With the deal now approaching its final phase, I would like to take this opportunity to personally thank our board of directors, executive team and, especially, all our employees at Amersham for their efforts and commitment, not only in producing this outstanding set of results, but also for their dedication to our long term goals.”

Business Performance

Sales were £1,652 million, up six per cent^#, with Amersham Health sales up seven per cent, Protein Separations sales up five per cent and Discovery Systems sales up two per cent^#. All regions experienced positive sales momentum led by North America up by eight per cent. Total R&D expenditure of £182 million (11 per cent of sales) was down four per cent, as expected, reflecting reduced expenditure in Discovery Systems as a result of the restructuring programme whilst maintaining growth in Amersham Health and Protein Separations. Operating profit was £299 million, up 12 per cent and after reduced net interest expense of £5 million, profit before tax increased by 14 per cent to £294 million. With the tax rate of 31.0 per cent for 2003 slightly lower than the 31.4 per cent reported in 2002 and a modest increase in the number of shares in issue, earnings per share before exceptional items and goodwill amortisation increased by 13 per cent to 29.0p. The board is recommending a dividend of 5.92p per share which is expected to be paid on 28 May, 2004, giving a full-year dividend of 8.77p per share, up 12 per cent.

The results, as reported in sterling, are affected by movements in foreign exchange. During 2003, the results were most notably impacted by the weakening of the US dollar with an overall adverse currency impact on profit before tax of £39 million.

Net cash flow from operating activities before exceptional items of £322 million was down from £346 million in 2002 affected by adverse foreign exchange movements. Free cash flow was £100 million (2002: £139 million) after an increase in capital expenditure of £22 million primarily in expanding manufacturing capacity. Net debt at the year end was £147 million, including a benefit of £20 million from movements in foreign exchange, compared to £182 million at 31 December 2002.

Statutory Results

The statutory results are shown after goodwill amortisation and exceptional items. Business performance profit before tax of £294 million was reduced by goodwill amortisation of £44 million and

exceptional items of £58 million giving statutory profit before tax of £192 million. Exceptional items comprise charges incurred in connection with the restructuring of Discovery Systems of £44 million, costs arising from the acquisition by GE of Amersham of £8 million and other net items of £6 million. Profit before tax was down from £264 million in 2002 because of an increase in goodwill amortisation of £7 million, increased exceptional items and the adverse impact of exchange. Statutory earnings per share were 16.5p, down from 26.1p in 2002.

Amersham Health — Medical Diagnostics and Therapy


	2003		2002		CER Growth
	£m		£m		%
Sales
Medical Diagnostics		924		886		9
Therapy		49		62		(17	)
Total		973		948		7
Operating profit		228		256		5

Amersham Health is a market-leading, international business specialising in the field of in vivo diagnostic products for the early and accurate detection of disease. In 2003, sales increased by seven per cent to £973 million with Medical Diagnostics accounting for £924 million, up nine per cent. Medical Diagnostics sales were driven by patented diagnostic products, which grew by 22 per cent to £412 million. Sales of unpatented diagnostic products grew by 2 per cent to £357 million. Sales of Visipaque^TM and Omniscan^TM each exceeded £100 million in 2003 bringing the number of products with more than £100 million in annual sales to four; the radiopharmaceutical heart diagnostic product Myoview^TM (£149 million, up 20 per cent), the second generation X-ray product Omnipaque^TM (£218 million, up two per cent), the magnetic resonance imaging (MRI) product Omniscan^TM (£106 million, up 12 per cent) and the third generation X-ray product Visipaque^TM (£122 million, up 38 per cent). Visipaque^TM sales growth accelerated from the 18 per cent growth achieved in 2002. Medical Diagnostics delivered improved underlying operating margins during the year partially compensating for lower margins in Therapy.

There has been significant progress in 2003 in advancing the development of the R&D portfolio, particularly in Japan where the submission of Fluordeoxyglucose (FDG) was achieved on schedule in December. Patient recruitment to support all clinical trial programmes reached an all time high in the last quarter of 2003 and reflects both the late stage of the development portfolio and the drive within the business for greater efficiency in programme management.

Amersham Biosciences – Protein Separations and Discovery Systems


	2003			2002			CER Growth
	£m			£m			%
Sales
Protein Separations		295			276			5
Discovery Systems		384			394			2^#
Operating profit
Protein Separations		106			107			9
Discovery Systems		(9	)		(32	)		46

Protein Separations

Protein Separations is the market leader in chromatographic systems for the purification of proteins from laboratory to manufacturing scale. In 2003 sales were £295 million up five per cent and operating profit was up nine per cent to £106 million. In the second half, operating margins improved through changes in the product mix and sales accelerated, driven by 14 per cent growth in laboratory separations. Overall sales growth was impacted by the slowdown in antisense product development with sales of speciality products declining 18 per cent after a strong performance in 2002.

R&D expenditure increased by 18 per cent accelerating the development of a number of new products targeting the research customer base, which are expected to reach the market in 2004 and 2005:

AKTAxpress^TM for automated multi-step high-throughput protein purification; and AKTAxflow^TM, a system designed to harness the dual capabilities of chromatographic and membrane separations. In bioprocessing, following the successful launch of MabSelect^TM, Amersham is preparing to launch a second generation affinity resin for purification of monoclonal antibodies. The technology behind this new product allows customers to reduce costs associated with their manufacturing processes.

Discovery Systems

Discovery Systems is a leading global provider of products and services used in disease research, drug discovery and drug development. Sales in 2003 grew two per cent^# to £384 million, with an operating loss of £9 million compared with £32 million in 2002.

The business achieved profitability in the second half following a successful realignment of the cost base by reducing R&D and manufacturing costs and refocusing the business portfolio on areas where there is strong long-term growth potential and where Amersham has existing market leadership. Restructuring cost savings in 2003 amounted to more than £20 million with revised expectations of annual savings running at the rate of more than £40 million by the end of 2004.

Sales continued to grow during the restructuring. The areas of strategic focus, including cellular assays, protein analysis and microarrays (Codelink^TM) showed good growth with sales up 14 per cent. In these areas a number of new products were launched during the year, including the IN Cell Analyzer 1000, a high-throughput sub-cellular imaging system and new DIGE dyes, sample preparation products and software for protein analysis.

Management

Peter Loescher was appointed to the role of Chief Operating Officer, effective 1 January 2004. Mr Loescher, 46, joined the company in December 2002 as President of Amersham Health and an Executive member of the Amersham plc Board. In this new role Mr Loescher will continue to lead Amersham Health and to report to Sir William Castell, Chief Executive, Amersham. Andrew Carr, President Discovery Systems and Peter Ehrenheim, President Protein Separations will report to Mr Loescher with respect to their operational responsibilities.

General Electric

On 10 October, 2003, General Electric Company and GE Investments, Inc (GE) and Amersham announced a recommended share exchange acquisition by GE of Amersham. Pre-conditions to the deal, including regulatory clearances from the European Commission and from the US anti-trust authorities, have been satisfied. Completion of the acquisition remains subject to a number of customary conditions, including the approval of Amersham shareholders and the sanction of the Scheme by the High Court and is expected in early April.

Group profit and loss account



			12 months to 31 Dec 2003									12 months to 31 Dec 2002
			Before									Before
			exceptional			Exceptional						exceptional			Exceptional
			items			items			Total			items			items		Total
	Notes		£m			£m			£m			£m			£m		£m
Sales including share of joint ventures		2,3		1,652			—			1,652			1,618			—		1,618
Less share of joint venture sales				(82	)		—			(82	)		(80	)		—		(80	)

Group turnover				1,570			—			1,570			1,538			—		1,538

Group operating profit before exceptional items and goodwill amortisation				276			—			276			287			—		287
Exceptional items		4		—			(45	)		(45	)		—			—		—
Goodwill amortisation				(44	)		—			(44	)		(37	)		—		(37	)

Group operating profit				232			(45	)		187			250			—		250
Share of operating profit of joint ventures and associates				23			—			23			23			—		23

Total operating profit		2		255			(45	)		210			273			—		273
Loss on disposal of fixed assets		4		—			(6	)		(6	)		—			—		—
Loss on disposal of business		4		—			(7	)		(7	)		—			—		—
Amounts written off investments				—			—			—			(2	)		—		(2	)
Net interest payable				(5	)		—			(5	)		(7	)		—		(7	)

Profit on ordinary activities before taxation				250			(58	)		192			264			—		264
Tax on profit on ordinary activities		4,5		(91	)		14			(77	)		(94	)		9		(85	)

Profit on ordinary activities after taxation				159			(44	)		115			170			9		179
Loss attributable to equity minority interests				1			—			1			1			—		1
Profit attributable to non-equity minority interests				—			—			—			(1	)		—		(1	)
Loss attributable to minority interests				1			—			1			—			—		—

Profit for the financial year attributable to shareholders				160			(44	)		116			170			9		179
Dividends paid and proposed		6		(62	)		—			(62	)		(58	)		—		(58	)

Retained profit for the financial year				98			(44	)		54			112			9		121

Earnings per ordinary share		7
— basic										16.5	p							26.1	p
— before exceptional items and goodwill amortisation										29.0	p							29.9	p
— average number of shares										699.5	m							684.7	m
Diluted earnings per ordinary share
— after exceptional items and goodwill amortisation										16.4	p							25.9	p

Dividends per ordinary share		6								8.77	p							7.80	p

All results are derived from continuing operations.

Share of operating profit of joint ventures and associates of £23m (2002 — £23m) includes income from the group’s joint venture interests in Nihon Medi-Physics (NMP) and in Oncura Inc for the 6 months from 1 July 2003.

Statement of total recognised gains and losses


			12 months to			12 months to
			31 Dec 2003			31 Dec 2002
	Notes		£m			£m
Profit for the financial year attributable to shareholders				116			179
Tax charge on foreign currency hedge loan				(2	)		(5	)
Unrealised gain on partial disposal of business		4		12			—
Foreign currency translation of net investment in subsidiaries				(9	)		53

Total recognised gains for the year				117			227

Reconciliation of movement in equity shareholders’ funds


			12 months to			12 months to
			31 Dec 2003			31 Dec 2002
	Notes		£m			£m
Profit for the financial year attributable to shareholders				116			179
Dividends		6		(62	)		(58	)

Retained earnings				54			121
Foreign currency translation				(11	)		48
New share capital and premium				13			408
Unrealised gain on partial disposal of business		4		12			—
Loss relating to Qualifying Employee Share Ownership Trust (QUEST)				—			(1	)

Net increase in equity shareholders’ funds				68			576
Equity shareholders’ funds at the start of the year				1,172			596

Equity shareholders’ funds at the end of the year				1,240			1,172

Group balance sheet


		At 31 Dec 2003			At 31 Dec 2002
		£m			£m
Fixed assets
Intangible assets			681			751
Tangible assets			708			641
Investments:
	Investment in joint ventures:
	— Share of gross assets		126			105
	— Share of gross liabilities		(38	)		(32	)

	— Share of net assets		88			73
	Investments in associates and other investments		21			26
			109			99

			1,498			1,491

Current assets
Stocks			222			208
Debtors — amounts due within one year			373			349
Debtors — amounts due after one year			53			61
Short term deposits and investments			27			22
Cash at bank and in hand			35			33

			710			673

Creditors — amounts due within one year
Loans			(126	)		(44	)
Other creditors			(492	)		(482	)

			(618	)		(526	)

Net current assets			92			147

Total assets less current liabilities			1,590			1,638

Creditors — amounts due after one year
Loans			(83	)		(193	)
Other creditors			(9	)		(11	)

			(92	)		(204	)

Provisions for liabilities and charges			(250	)		(253	)

Accruals and deferred income			(3	)		(4	)

Total net assets			1,245			1,177

Equity capital and reserves
Share capital			35			35
Share premium account			482			469
Other reserves			94			94
Profit and loss account			629			574

Equity shareholders’ funds			1,240			1,172

Minority interests			5			5

			1,245			1,177

Group cash flow statement


			12 months to			12 months to
			31 Dec 2003			31 Dec 2002
	Notes		£m			£m
Net cash inflow from operating activities before exceptional items		8		322			346
Exceptional items				(24	)		—

Net cash inflow from operating activities				298			346

Dividend received from joint venture				9			5

Returns on investments and servicing of finance
Interest paid				(2	)		(9	)
Interest received				1			5
Dividends paid by subsidiary undertakings to minority interests				(2	)		(2	)

				(3	)		(6	)

Taxation				(65	)		(57	)

Capital expenditure and financial investment
Purchase of tangible fixed assets				(168	)		(143	)
Purchase of intangible fixed assets				(2	)		(5	)
Sales of tangible fixed assets				3			1
Purchase of trade investments				(3	)		(3	)
Costs associated with disposal of investment in Nycomed Pharma				(2	)		(4	)
Sale of own shares				4			—
Sale of trade investments				3			1

				(165	)		(153	)

Acquisitions and disposals
Purchase of 45% minority in Amersham Biosciences				—			(704	)
Costs associated with the purchase of 45% minority in Amersham Biosciences				—			(5	)
Other acquisitions				(17	)		(40	)
Disposals				1			—
Cash transferred on disposal of business				(1	)		—

				(17	)		(749	)

Equity dividends paid				(56	)		(52	)

Net cash flow before management of liquid resources and financing				1			(666	)

Management of liquid resources*		9		(4	)		75

Financing
Issue of share capital				13			413
Costs associated with issue of share capital				—			(5	)
Loans and finance leases		9		(12	)		162
Repayment of long term loan				—			(14	)
Capital contribution by minority interest				1			9

				2			565

Cash flow in the year		9		(1	)		(26	)

Analysis of free cash flow before exceptional items
Free cash flow from:
Operating activities before exceptional items		8		322			346
Dividend received from joint venture				9			5
Returns on investments and servicing of finance				(3	)		(6	)
Taxation				(65	)		(57	)

Free cash flow after taxation and returns on investments and servicing of finance				263			288
Capital expenditure and financial investment prior to the disposal of Nycomed Pharma				(163	)		(149	)

Free cash flow before equity dividends				100			139

Free cash flow after equity dividends				44			87


*	Liquid resources are defined as short term deposits with banks and current asset investments in bonds and equities. These total £27m (2002 — £22m) and are shown in the balance sheet within the total of short term deposits and investments.

Notes to the financial statements

1. Basis of preparation

The Preliminary Announcement of results for the year ended 31 December 2003 is an excerpt from the forthcoming Annual Report & Accounts 2003 and does not constitute the statutory financial statements of 2003 nor 2002. The 2003 figures are extracted from the unaudited financial statements for that year which have not yet been approved by the shareholders and have not yet been delivered to the Registrar of Companies. The comparative figures are extracted from the latest published financial statements that have been delivered to the Registrar of Companies. The auditors’ report in respect of the year ended 31 December 2002 was unqualified and did not contain a statement under either Section 237(2) or Section 237(3) of the Companies Act 1985.

2. Segmental analysis by business sector


		12 months to		12 months to
		31 Dec 2003		31 Dec 2002
		£m		£m
Sales
Amersham Health			973		948
Amersham Biosciences
	Protein Separations		295		276
	Discovery Systems		384		394

			1,652		1,618


	Included within Amersham Health is the group’s share of joint venture sales during the year of £82m (2002 — £80m).


Total operating profit before exceptional items and goodwill amortisation
Amersham Health		228		256
Amersham Biosciences
	Protein Separations	106		107
	Discovery Systems	(9	)	(32	)
Corporate and other		(26	)	(21	)

		299		310


	Total operating profit before exceptional items and goodwill amortisation of £299m (2002 — £310m) is after charging research and development of £182m (2002 — £184m). Research and development costs of Amersham Health are £102m (2002 — £95m), Protein Separations £26m (2002 — £22m), Discovery Systems £51m (2002 — £66m) and Corporate and other £3m (2002 — £1m).

	The following table shows operating profit after allocation of exceptional items and goodwill amortisation. The exceptional items charged in 2003 relate £1m (2002 — £nil) to Amersham Health, £2m (2002 — £nil) to Protein Separations, £37m (2002 — £nil) to Discovery Systems and £5m (2002 — £nil) to Corporate and other. Amortisation charged on goodwill in 2003 relates £2m (2002 — £1m) to Amersham Health, £29m (2002 — £24m) to Protein Separations and £13m (2002 — £12m) to Discovery Systems.


Total operating profit after exceptional items and goodwill amortisation
Amersham Health		225		255
Amersham Biosciences
	Protein Separations	75		83
	Discovery Systems	(59	)	(44	)
Corporate and other		(31	)	(21	)

		210		273


	Included within Amersham Health is the group’s share of joint venture profit before interest and tax for the year of £23m (2002 — £23m).

3. Segmental analysis by geographical sector


	12 months to		12 months to
	31 Dec 2003		31 Dec 2002
By destination	£m		£m
Sales
Europe		462		428
North America		807		799
Japan		247		264
Asia Pacific		95		80
Rest of the world		41		47

		1,652		1,618


	Included within Japan is the group’s share of NMP joint venture sales during the year of £75m (2002 — £80m), and within North America is the group’s share of Oncura Inc joint venture sales of £7m (2002 — £nil).

4. Exceptional items


	12 months to			12 months to
	31 Dec 2003			31 Dec 2002
	£m			£m
Costs associated with the restructuring of Discovery Systems business		(37	)		—
Costs associated with the General Electric offer		(8	)		—

Total exceptional charge to operating profit		(45	)		—

Asset write-offs associated with the restructuring of Discovery Systems business		(7	)		—
Profit on disposal of own shares		1			—

Loss on disposal of fixed assets		(6	)		—

Provision for loss on disposal of Cimarron business		(10	)		—
Realised gain on partial disposal of Brachytherapy business		3			—

Loss on disposal of business		(7	)		—

Total exceptional items before taxation		(58	)		—

Tax credit relating to exceptional items		14			—
Tax credit relating to group reorganisation		—			9

Total exceptional items after taxation		(44	)		9


	In February 2003, the group announced a restructuring of its Discovery Systems business. Operating costs of £37m, relating primarily to staff termination payments, and £7m of fixed asset write offs have been incurred on the project during 2003, with a related tax credit of £13m. Of the total costs of £44m incurred, cash outflow was £22m in the period.

	In July 2003, the group combined its Brachytherapy commercial operations with the urology business of Galil Medical. The net effect of the transaction has been to dispose of a 25% interest in Amersham’s Brachytherapy commercial operations in exchange for a 75% interest in Galil Medical’s urology business and £3m in cash. A realised gain of £3m has been recognised on the disposal, with an unrealised gain of £12m recognised in the statement of total recognised gains and losses.

	In October 2003, the group announced that it had reached agreement with General Electric Company (GE) on the terms of a recommended share exchange acquisition of Amersham by GE. Costs of £8m relating to the offer have been incurred in 2003, primarily relating to advisor fees and incremental social security relating to share options, with a related tax credit of £1m. Cash outflow of £2m was incurred during 2003.

	In December 2003, following a decision to exit from its investment in Cimarron Software Inc, the group has provided for a loss on disposal of the business, writing down the related goodwill and other assets to net realisable value, resulting in a charge of £10m. The exit from the business was completed on 2 February 2004. There is no cash impact from this exceptional charge.

	In December 2003, the group realised a gain of £1m on the disposal of 480,000 own shares for £7.63 per share. The cash inflow resulting from this disposal was £4m.


	In 2002, as a result of the formation of a consolidated tax group in the US on 31 July 2002, the group recognised a deferred taxation asset of £9m, relating to future utilisation of tax losses arising from prior periods.

5. Tax on profit on ordinary activities


			12 months to			12 months to
			31 Dec 2003			31 Dec 2002
	Note		£m			£m
UK corporation tax at 30% (2002 — 30%)
Current				37			4
Double tax relief				(37	)		(8	)

				—			(4	)
Overseas taxation				77			84
Over-provision in respect of prior years				(7	)		(19	)
Share of joint ventures and associates				10			10

Total current tax				80			71

Deferred tax
Origination and reversal of timing differences				12			7
Prior year deferred tax movement				(1	)		16

Total deferred tax				11			23

Tax before exceptional items				91			94
Exceptional items		4		(14	)		(9	)

				77			85

6. Dividends paid and proposed


	12 months to		12 months to
	31 Dec 2003		31 Dec 2002
	£m		£m
Paid — interim dividend of 2.85p per share (2002 — 2.65p per share)		20		22
Proposed — dividend of 5.92p per share (2002 — nil p per share)		42		—
Proposed — final dividend of nil p per share (2002 — 5.15p per share)		—		36

		62		58


	A dividend of 5.92p per share is proposed subject to completion of the Acquisition, bringing the total dividend for the year to 8.77p.

	Included within the interim dividend for 2002 of £22m is £3m relating to the final 2001 dividend paid to holders of the 57.5m new ordinary shares which were issued by means of a placing on 18 March 2002.

7. Earnings per ordinary share


	Basic earnings per ordinary share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares in issue in the year, excluding those held by employee share trusts. For diluted earnings per ordinary share, the weighted average number of ordinary shares is adjusted to assume conversion of all potentially dilutive ordinary shares.


	The calculation of earnings per ordinary share is based on the following attributable profit and weighted average number of shares.



	12 months to						12 months to
	31 Dec 2003						31 Dec 2002
	£m			p			£m			p
Attributable profit
Profit attributable to shareholders — basic		116			16.5			179			26.1

Add back the following items :
Exceptional items		58			8.2			—			—
Goodwill amortisation		44			6.3			37			5.3
Adjust for related amounts of :
Taxation		(14	)		(2.0	)		(9	)		(1.3	)
Minority interest		—			—			(2	)		(0.2	)

Profit attributable to shareholders before exceptional items and goodwill amortisation		204			29.0			205			29.9

Average number of shares
Basic		699.5	m					684.7	m
Dilution effect of outstanding share options		4.0	m					4.0	m

Diluted		703.5	m					688.7	m

Earnings per ordinary share
— basic					16.5	p					26.1	p
— before exceptional items and goodwill amortisation					29.0	p					29.9	p
— diluted (after exceptional items and goodwill amortisation)					16.4	p					25.9	p


	Earnings per ordinary share before exceptional items and goodwill amortisation is presented in order to show the impact on earnings of non-recurring items and goodwill.

8. Net cash flow from operating activities


	12 months to			12 months to
	31 Dec 2003			31 Dec 2002
	£m			£m
Total operating profit before exceptional items		255			273
Share of operating profit of joint ventures and associates		(23	)		(23	)
Depreciation and amortisation		131			117
Loss on sale of tangible fixed assets		3			2
(Decrease) in provisions		(25	)		(7	)
(Increase) in stocks		(18	)		(20	)
(Increase)/decrease in debtors		(20	)		5
Increase/(decrease) in creditors		19			(1	)

Net cash inflow from operating activities before exceptional items		322			346
Exceptional items		(24	)		—

Net cash inflow from operating activities		298			346

9. Analysis of net debt


	As at			Other non-cash						Exchange		As at
	1 Jan 2003			changes			Cash flow			movements		31 Dec 2003
	£m			£m			£m			£m		£m
Cash at bank and in hand		33			—			2			—		35
Overdrafts		(7	)		—			(3	)		1		(9	)

		26			—			(1	)		1		26
Liquid resources		22			—			4			1		27
Loans due within one year		(37	)		(92	)		10			2		(117	)
Loans due after more than one year		(193	)		92			2			16		(83	)

Net debt		(182	)		—			15			20		(147	)


	Other non-cash changes represent the reclassification of loan balances that mature within one year.

10. Post balance sheet events


	On 21 January 2004, the group announced that the pre-conditions to the making of the share exchange acquisition of Amersham plc by General Electric Company and GE Investments Inc had been satisfied. The pre-conditions included regulatory clearance from the European Commission and from the US anti-trust authorities. Completion of the acquisition remains subject to a number of customary conditions, including the approval of the Amersham shareholders and the sanction of the Scheme by the High Court and is expected in early April.

	On 2 February 2004, the group completed the exit from its investment in Cimarron Software Inc, by selling the group’s holding for US$1, although the group will continue to distribute Cimarron products.


2.	Summary of differences between UK and US Generally Accepted Accounting Principles (unaudited) for the year ended 31 December 2003

The following is a summary of the adjustments to the group’s net income and shareholders’ equity of applying the significant differences between UK GAAP and US GAAP. These are summarised in the tabular reconciliation statements set out below.

Reconciliation of consolidated net income


				12 months to			12 months to
				31 Dec 2003			31 Dec 2002
	Notes			£m			£m
Profit attributable to shareholders reported under UK GAAP					116			179
US GAAP adjustments:
Business combinations		(i	)		(36	)		(114	)
Disposal of investment in Nycomed Pharma		(iii	)		—			(1	)
Derivative hedging		(iv	)		(3	)		66
Pension and post retirement costs		(v	)		(15	)		(5	)
Revenue recognition		(vi	)		1			(1	)
Deferred taxation — application of full liability method		(vii	)		3			6
Compensated absences, equity instruments and other		(viii	)		(7	)		—
Tax effect of US GAAP adjustments					30			30
Minority interest		(x	)		—			1

Total US GAAP adjustments					(27	)		(18	)

Net income in accordance with US GAAP					89			161

Basic net income per share in accordance with US GAAP					12.7	p		23.4	p

Diluted net income per share in accordance with US GAAP					12.6	p		23.3	p

Reconciliation of shareholders’ equity


				31 Dec 2003			31 Dec 2002
	Notes			£m			£m
Equity shareholders’ funds reported under UK GAAP					1,240			1,172
US GAAP adjustments:
Business combinations		(i	)		1,016			1,067
Accounting for investment in NMP		(ii	)		41			42
Derivative hedging		(iv	)		25			33
Pension and post retirement costs		(v	)		(36	)		(69	)
Revenue recognition		(vi	)		(3	)		(4	)
Deferred taxation — application of full liability method		(vii	)		27			28
Compensated absences, equity instruments and other		(viii	)		(21	)		(22	)
Ordinary dividend		(ix	)		42			36
Tax effect of US GAAP adjustments					(116	)		(143	)

Total US GAAP adjustments					975			968

Shareholders’ equity in accordance with US GAAP					2,215			2,140

(i) Business combinations

Under both UK GAAP and US GAAP, acquisitions are accounted for as purchase business combinations. However, certain differences between UK GAAP and US GAAP in the application of the purchase method of accounting for business combinations are set out below.

Both UK GAAP and US GAAP require purchase consideration to be allocated to the net assets acquired at their fair value on the date of acquisition, with the difference between the consideration and the fair value of the identifiable net assets recorded as goodwill. Under the requirements of Financial Reporting Standard (FRS) 10 ‘Goodwill and intangible assets’, goodwill arising on acquisitions of subsidiaries, joint ventures, and associates during accounting periods ending on or after 23 December 1998 should be capitalised and amortised over its useful economic life. This treatment of goodwill is similar to its treatment under US GAAP prior to the introduction of Statement of Financial Accounting Standards (SFAS)142 ‘Goodwill and Other Intangible Assets’. However, because FRS 10 need not be applied retrospectively to goodwill written off against shareholders’ funds in earlier years, there will continue to be differences between the goodwill calculated under UK GAAP and US GAAP. For the purposes of US GAAP, goodwill written off against shareholders’ funds under UK GAAP has been reinstated.

UK GAAP requires an allocation of purchase consideration to intangible assets, which are separable from the business. For UK GAAP purposes, intangible assets, other than goodwill, acquired in a business combination, which are not separable and measurable, are not capitalised. US GAAP requires an allocation of consideration to identifiable intangible assets if they arise from contractual or other legal rights; if intangible assets do not arise from contractual or legal rights, the asset is recognised apart from goodwill only if it is separable. The intangible assets recognised for US GAAP are being amortised on a straight-line basis over periods up to 15 years.

Under US GAAP, following the introduction of SFAS 142, goodwill and intangible assets with indefinite useful lives are not amortised but reviewed annually for impairment. The annual goodwill amortisation charge recognised for UK GAAP has therefore been reversed for US GAAP purposes.

Purchase of 45% minority interest in Amersham Biosciences in 2002

Under UK GAAP, fair value adjustments have been recognised for tangible fixed assets, listed investments and the funded status of pensions. Under US GAAP, additional fair value adjustments have been recognised for separable intangible assets, in-process research and development and the revaluation of inventory. Intangible assets are being amortised on a straight-line basis over periods up to 10 years.

Profit or loss on the partial disposal of businesses

Under UK GAAP, gains on the partial disposal of businesses involving non-monetary consideration are recorded in the statement of total recognised gains and losses. Under US GAAP, when recorded in connection with a business combination, these gains and losses are recorded in the income statement.

(ii) Accounting for investment in Nihon Medi-Physics (NMP)

Under UK GAAP the change from the cost method to the equity method in the year ended 31 March 1997, due to the acquisition of an additional interest in NMP, did not require retroactive adjustment to the financial statements. Under US GAAP the investment, the results of operations, and shareholders’ equity of the group were adjusted retroactively in a manner consistent with the accounting for a step-by-step acquisition of a subsidiary.

(iii) Disposal of investment in Nycomed Pharma

In 2001, the group sold its trade investment in Nycomed Pharma. Under US GAAP, the investment was treated as an associate company resulting in a lower profit on disposal under the equity method of accounting. Certain costs associated with the sale have been recognised in 2002 for US GAAP.

(iv) Derivative hedging

Under US GAAP, the group does not qualify for hedge accounting and so gains and losses arising on derivative instruments at the year end have been booked directly to income.

(v) Pension and post retirement costs

Under both UK GAAP and US GAAP, pension and post retirement costs are based on actuarial assumptions. However, under UK GAAP the cost is based on long term market and economic assumptions and under US GAAP the cost is based on current market and economic assumptions. In line with SFAS 87 ‘Employers’ Accounting for Pensions’ an additional minimum liability equal to the unfunded accumulated benefit obligation is recognised when the accumulated benefit obligation exceeds the fair value of pension fund assets.

A transfer of assets was received from former pension plans during 2001. Under UK GAAP, the proportion of the transfer relating to current employees of the group is being spread over the remaining service life of the employees in line with SSAP 24. Under US GAAP this was taken to income during 2001.

(vi) Revenue recognition

Under UK GAAP, contract revenue is recognised when it is earned and non-refundable and when there are no future obligations under the contract terms. Under US GAAP, the group applies Staff Accounting Bulletin 101 (SAB 101) ‘Revenue Recognition in Financial Statements’. Under SAB 101, more prescriptive criteria are applied to assess whether the culmination of the earnings process has occurred

and the group has a continuing obligation throughout the contract terms. As a result, certain non-refundable fees have been deferred over the contract terms under US GAAP.

(vii) Deferred taxation

Under UK GAAP, provision for deferred taxation is recorded under FRS 19. Except for certain timing differences relating to revaluations, rolled over taxable gains and unremitted income, a provision is made for all timing differences that would give rise to a deferred tax liability. Deferred tax assets are recognised to the extent that it is more likely than not they will be recoverable. Under US GAAP, deferred tax is provided for on a full liability basis, which includes these exceptions noted above. A valuation allowance is established when it is more likely than not that some portion or all of the deferred tax asset will not be realised.

(viii) Compensated absences, equity instruments and other

Differences between UK GAAP and US GAAP relate to accounting for compensated absences, investments in equity securities, ESOP transactions, social security on share option gains and stock based compensation.

(ix) Ordinary dividends

Under UK GAAP, dividends proposed are provided for in the period in respect of which they are recommended by the Board of Directors for approval by the shareholders. Under US GAAP, dividends are recorded as a reduction to retained earnings when they have been formally declared, and notice given to shareholders.

(x) Minority interest

The amount represents the components of the US GAAP adjustments attributable to Pharmacia Corporation’s 45% interest in Amersham Biosciences. The minority interest was extinguished in 2002 on the purchase of the 45% interest in Amersham Biosciences that the group did not already own.


3.	Financial information for the three years ended 31 December 2002

Group profit and loss account



			12 months to 31 Dec 2002								12 months to 31 Dec 2001
			Before								Before
			exceptional			Exceptional					exceptional			Exceptional
			items			items		Total			items			items			Total
	Notes		£m			£m		£m			£m			£m			£m
Sales including share of joint venture		1,2		1,618.2			—		1,618.2			1,602.5			—			1,602.5
Less share of joint venture sales				(80.5	)		—		(80.5	)		(87.3	)		—			(87.3	)

Group turnover				1,537.7			—		1,537.7			1,515.2			—			1,515.2

Group operating profit before exceptional items and goodwill amortisation				286.6			—		286.6			266.4			—			266.4
Exceptional items		3		—			—		—			—			(8.7	)		(8.7	)
Goodwill amortisation		11		(36.6	)		—		(36.6	)		(11.7	)		—			(11.7	)

Group operating profit		4		250.0			—		250.0			254.7			(8.7	)		246.0
Share of operating profit of joint venture and associates				23.2			—		23.2			26.1			—			26.1

Total operating profit		1,2,4		273.2			—		273.2			280.8			(8.7	)		272.1
Profit on sale of fixed asset investment		3		—			—		—			—			55.3			55.3
Amounts written off investments				(2.4	)		—		(2.4	)		(4.4	)		—			(4.4	)
Net interest payable		7		(7.1	)		—		(7.1	)		(8.7	)		—			(8.7	)

Profit on ordinary activities before taxation				263.7			—		263.7			267.7			46.6			314.3
Tax on profit on ordinary activities		3,8		(94.3	)		9.2		(85.1	)		(97.0	)		0.5			(96.5	)

Profit on ordinary activities after taxation				169.4			9.2		178.6			170.7			47.1			217.8

Loss/(profit) attributable to equity minority interests				0.7			—		0.7			(6.2	)		2.0			(4.2	)
Profit attributable to non-equity minority interests				(0.6	)		—		(0.6	)		(2.9	)		—			(2.9	)

Loss/(profit) attributable to minority interests				0.1			—		0.1			(9.1	)		2.0			(7.1	)

Profit for the financial year attributable to shareholders				169.5			9.2		178.7			161.6			49.1			210.7
Dividends paid and proposed		9		(57.3	)		—		(57.3	)		(45.2	)		—			(45.2	)

Retained profit for the financial year				112.2			9.2		121.4			116.4			49.1			165.5

Earnings per ordinary share		10
— basic									26.1	p								33.2	p
— before exceptional items and goodwill amortisation									29.9	p								26.6	p
— average number of shares									684.7	m								634.4	m
Diluted earnings per ordinary share
— after exceptional items and goodwill amortisation									25.9	p								33.0	p

Dividends per ordinary share		9							7.80	p								7.10	p

Share of operating profit of joint venture and associates includes income from the group’s joint venture interest in Nihon Medi-Physics (NMP) of £23.2m (2001 — £26.1m, 2000 — £29.8).

Figures for the 12 months to 31 December 2001 have been restated following the introduction of FRS19 as explained in note 36(a). Figures for the 12 months to 31 December 2000 have been restated following the introduction of FRS18 as explained in note 36(b).

All results are derived from continuing operations.

Group profit and loss account (cont)



			12 months to 31 Dec 2000
			Before
			exceptional			Exceptional
			items			items			Total
	Notes		£m			£m			£m
Sales including share of joint venture		1,2		1,377.6			—			1,377.6
Less share of joint venture sales				(94.8	)		—			(94.8	)

Group turnover				1,282.8			—			1,282.8

Group operating profit before exceptional items and goodwill amortisation				211.4			—			211.4
Exceptional items		3		—			(27.0	)		(27.0	)
Goodwill amortisation		11		(10.7	)		—			(10.7	)

Group operating profit		4		200.7			(27.0	)		173.7
Share of operating profit of joint venture and associates				29.8			—			29.8

Total operating profit		1,2,4		230.5			(27.0	)		203.5
Profit on sale of fixed asset investment		3		—			—			—
Amounts written off investments				—			—			—
Net interest payable		7		(10.0	)		—			(10.0	)

Profit on ordinary activities before taxation				220.5			(27.0	)		193.5
Tax on profit on ordinary activities		3,8		(78.5	)		2.4			(76.1	)

Profit on ordinary activities after taxation				142.0			(24.6	)		117.4

Profit attributable to equity minority interests				(3.7	)		—			(3.7	)
Profit attributable to non-equity minority interests				(2.9	)		—			(2.9	)

Profit attributable to minority interests				(6.6	)		—			(6.6	)

Profit for the financial year attributable to shareholders				135.4			(24.6	)		110.8
Dividends paid and proposed		9		(40.4	)		—			(40.4	)

Retained profit for the financial year				95.0			(24.6	)		70.4

Earnings per ordinary share		10
— basic										17.6	p
— before exceptional items and goodwill amortisation										22.5	p
— average number of shares										630.9	m
Diluted earnings per ordinary share
— after exceptional items and goodwill amortisation										17.4	p

Dividends per ordinary share		9								6.40	p

Statement of total recognised gains and losses


			12 months to			12 months to			12 months to
			31 Dec 2002			31 Dec 2001			31 Dec 2000
	Notes		£m			£m			£m
Profit for the financial year attributable to shareholders				178.7			210.7			110.8
Tax (charge)/credit on foreign currency hedge loan		26		(5.4	)		0.3			3.5
Foreign currency translation of net investment in subsidiaries				53.4			(4.0	)		(22.3	)
Foreign currency translation of net investment in joint venture				(0.2	)		(0.2	)		(0.1	)

Total recognised gains for the year				226.5			206.8			91.9

Prior year adjustment		36		4.4

Total gains recognised since last Annual Report				230.9

Reconciliation of movement in equity shareholders’ funds


				12 months to			12 months to			12 months to
				31 Dec 2002			31 Dec 2001			31 Dec 2000
	Notes			£m			£m			£m
Profit for the financial year attributable to shareholders					178.7			210.7			110.8
Dividends		9			(57.3	)		(45.2	)		(40.4	)

Retained earnings					121.4			165.5			70.4
Foreign currency translation		26			47.8			(3.9	)		(18.9	)
New share capital and premium (net of issue costs of £5.5m in 2002)		25,26			407.7			25.2			6.2
(Loss)/gain relating to Qualifying Employee Share Ownership Trust (QUEST)		26			(1.2	)		1.6			—
Contribution to Qualifying Employee Share Ownership Trust (QUEST)					—			(9.0	)		(0.7	)

Net increase in equity shareholders’ funds					575.7			179.4			57.0

Equity shareholders’ funds at the start of the year as previously reported					591.9			408.4			354.6
Prior year adjustment — FRS 19		36(a	)		4.4			8.5			—
Prior year adjustment — FRS 18		36(b	)		—			—			(3.2	)

Restated					596.3			416.9			351.4

Equity shareholders’ funds at the end of the year					1,172.0			596.3			408.4

Equity shareholders’ funds for the 12 months to 31 December 2000 have been restated for the adoption of FRS 18 in 2001 and equity shareholders’ funds for the 12 months to 31 December 2001 have been restated for the adoption of FRS 19 in 2002, as outlined in note 36.

Group balance sheet


				At 31 Dec			At 31 Dec			At 31 Dec
				2002			2001			2000
		Notes		£m			£m			£m
Fixed assets
Intangible assets			11		751.2			152.7			149.5
Tangible assets			12		640.8			533.1			523.5
Investments:
	Investment in joint venture:
	— Share of gross assets				105.2			93.7			102.8
	— Share of gross liabilities				(32.2	)		(26.6	)		(36.7	)

	— Share of net assets		13		73.0			67.1			66.1
	Investments in associates and other investments		13		26.4			35.0			37.6
			13		99.4			102.1			103.7

					1,491.4			787.9			776.7

Current assets
Stocks			14		208.0			180.6			171.1
Debtors — amounts due within one year			15		349.2			360.8			354.5
Debtors — amounts due after one year			16		61.3			55.4			23.8
Short term deposits and investments			17		22.1			99.4			54.8
Cash at bank and in hand			32		32.7			56.9			50.1

					673.3			753.1			654.3

Creditors — amounts due within one year
Loans			18		(44.6	)		(30.8	)		(12.9	)
Other creditors			18		(482.2	)		(452.5	)		(375.2	)

					(526.8	)		(483.3	)		(388.1	)

Net current assets					146.5			269.8			266.2

Total assets less current liabilities					1,637.9			1,057.7			1,042.9

Creditors — amounts due after one year
Loans			19		(192.5	)		(148.0	)		(365.4	)
Other creditors			19		(11.5	)		(6.4	)		(4.4	)

					(204.0	)		(154.4	)		(369.8	)

Provisions for liabilities and charges			22		(253.5	)		(240.8	)		(202.9	)

Accruals and deferred income					(3.5	)		(3.6	)		(3.9	)

Total net assets					1,176.9			658.9			466.3

Equity capital and reserves
Share capital			25		35.1			32.1			31.8
Share premium account			26		469.0			64.3			39.4
Other reserves			26		94.0			94.0			94.0
Profit and loss account			26		573.9			405.9			243.2

Equity shareholders’ funds					1,172.0			596.3			408.4

Minority interests
— Equity					4.9			20.0			18.2
— Non-equity			20		—			42.6			39.7

					4.9			62.6			57.9

					1,176.9			658.9			466.3

Group cash flow statement


			12 months to			12 months to			12 months to
			31 Dec 2002			31 Dec 2001			31 Dec 2000
	Notes		£m			£m			£m
Net cash inflow from operating activities before exceptional items		31		345.5			342.3			255.3
Integration costs				—			—			(15.8	)
Exceptional items				—			12.0			(14.8	)

Net cash inflow from operating activities		31		345.5			354.3			224.7

Dividend received from joint venture				5.4			4.8			3.9

Returns on investments and servicing of finance
Interest paid				(9.2	)		(19.7	)		(30.5	)
Interest received				4.9			10.3			13.5
Dividends paid by subsidiary undertakings to minority interests				(1.7	)		(1.7	)		(1.4	)

				(6.0	)		(11.1	)		(18.4	)

Taxation				(57.2	)		(47.6	)		(15.8	)

Capital expenditure and financial investment
Purchase of tangible fixed assets				(143.4	)		(91.6	)		(123.5	)
Purchase of intangible fixed assets				(4.8	)		(10.2	)		(4.5	)
Sales of tangible fixed assets				1.3			22.1			0.3
Purchase of own shares				—			—			(16.5	)
Purchase of trade investments				(3.4	)		(4.9	)		(10.5	)
Cash received on disposal of investment in Nycomed Pharma				—			123.0			—
Costs associated with disposal of investment in Nycomed Pharma				(3.5	)		(4.9	)		—
Sale of trade investments				1.4			—			4.2

				(152.4	)		33.5			(150.5	)

Acquisitions and disposals
Purchase of 45% minority in Amersham Biosciences		24		(704.1	)		—			—
Costs associated with the purchase of 45% minority in Amersham Biosciences		24		(4.5	)		—			—
Other acquisitions				(40.6	)		(4.9	)		(10.9	)
Other disposals				—			1.0			6.0

				(749.2	)		(3.9	)		(4.9	)

Equity dividends paid				(51.6	)		(41.7	)		(38.2	)

Net cash flow before management of liquid resources and financing				(665.5	)		288.3			0.8

Management of liquid resources*		32,33		74.5			(91.4	)		64.1

Financing
Issue of share capital		25		413.2			16.2			6.2
Costs associated with issue of share capital				(5.5	)		—			—
Loans and finance leases		32,33		161.9			(205.3	)		(70.3	)
Repayment of long term loan		32,33		(13.6	)		—			—
Capital contribution by minority interest in Amersham Biosciences				8.7			—			—

				564.7			(189.1	)		(64.1	)

Cash flow in the year		32,33		(26.3	)		7.8			0.8

Analysis of free cash flow before exceptional items
Free cash flow from:
Operating activities before exceptional items		31		345.5			342.3			255.3
Dividend received from joint venture				5.4			4.8			3.9
Returns on investments and servicing of finance				(6.0	)		(11.1	)		(18.4	)
Taxation				(57.2	)		(47.6	)		(15.8	)

Free cash flow after taxation and returns on investments and servicing of finance				287.7			288.4			225.0
Capital expenditure and financial investment prior to the disposal of Nycomed Pharma				(148.9	)		(84.6	)		(150.5	)

Free cash flow before equity dividends				138.8			203.8			74.5

Free cash flow after equity dividends				87.2			162.1			36.3


*	Liquid resources are defined as short term deposits with banks and current asset investments in bonds and equities. These total £22.1m (2001 — £96.5m, 2000 — £4.7m) and are shown in the balance sheet within the total of short term deposits and investments.

Accounting policies

Basis of preparation

The group’s main accounting policies are set out below. The financial statements are prepared in accordance with the historical cost convention, except for the company’s investments (see below), and all applicable United Kingdom accounting standards. As the group profit and loss account is already at historical cost no separate note of historical cost profit and loss is included as allowed by Financial Reporting Standard (FRS) 3. No profit and loss account is presented for the company as permitted by S230(2) of the Companies Act 1985.

New accounting standards

The following new accounting standards issued by the UK Accounting Standards Board, have been adopted during the three financial years:

FRS 19 Deferred Taxation

The change to existing accounting policies arising from the adoption of FRS 19 is described in note 36(a). The results for the year to 31 December 2001 have been restated for the adoption of FRS 19 in 2002 as described in note 36(a).

FRS 18 Accounting Policies

The results for the year to 31 December 2000 have been restated for the adoption of FRS 18 in 2001, as described in note 36(b).

FRS 17 Retirement Benefits

The group is following the transitional arrangements under which additional disclosure is required in the notes to the financial statements for the years ending 31 December 2001 and 31 December 2002. The standard becomes mandatory for accounting periods beginning on or after 1 January 2005.

Basis of consolidation

The consolidated group profit and loss account and balance sheet include the financial statements of the company and its subsidiary undertakings made up to 31 December. The results of subsidiaries sold or acquired are included in the consolidated profit and loss account up to, or from, the date control passes. Intra-group sales and profits are eliminated fully on consolidation.

On acquisition of a subsidiary, all of the subsidiary’s assets and liabilities that exist at the date of acquisition are recorded at their fair values reflecting their condition at that date. All changes to those assets and liabilities, and the resulting gains and losses, that arise after the group has gained control of the subsidiary are dealt with in the post acquisition profit and loss account.

Foreign currencies

The results of the overseas subsidiary, joint venture and associated undertakings are translated at the average exchange rates of the period during which they arise. Overseas subsidiary undertakings’ assets and liabilities and the net investments in joint venture and associated undertakings are translated at the year end exchange rates. Differences arising on translation, together with differences on foreign currency loans of the group which match investments, are dealt with through reserves.

Derivative financial instruments

The group enters into derivative instruments primarily to manage exposures to fluctuations in interest rates and foreign currency exchange rates. Interest differentials under interest rate swap instruments and forward rate agreements (FRAs) are recognised on an accruals basis.

It is the group’s policy, where appropriate, to protect the sterling value of its estimated future foreign currency net receivables through the use of forward contracts or currency options. Net revenues and related net receivables covered by forward exchange contracts or options are translated into sterling at contract rates. No account is taken of profits or losses on forward exchange contracts or options which are intended as a hedge against future transactions; such profits and losses are accounted for so as to match the exchange differences arising on the underlying currency transactions.

Research and development expenditure

Research and development expenditure is written off as it is incurred.

Fixed assets

Fixed assets are stated at cost less depreciation and provision for impairment, where appropriate. Cost includes appropriate labour and directly attributable costs. Finance costs on borrowings used to finance the construction of tangible fixed assets are written off to the profit and loss account as incurred.

Directly acquired intangible assets, comprising patents, patent applications, trademarks and know-how, are stated at cost less amortisation. Intangible assets, other than goodwill, acquired in a business combination, which are not separable and measurable are not capitalised.

Goodwill arising on consolidation represents the excess of the fair value of the consideration over the fair value of the identifiable net assets acquired. Goodwill and negative goodwill arising on the acquisition of subsidiary undertakings, joint venture and associated undertakings prior to 31 December 1997 was written off immediately against reserves. Goodwill arising on acquisitions after 1 January 1998 is capitalised and amortised over its estimated useful economic life where the goodwill is regarded as having a limited useful economic life. In accordance with the requirement of Financial Reporting Standard (FRS) 10, capitalised goodwill is reviewed for evidence of impairment at the end of the first full financial year following the initial date of recognition.

Depreciation and amortisation are calculated as follows:


Intangible assets		Amortised on a straight-line basis at rates from 5% to 36% p.a.
Goodwill		Amortised on a straight-line basis at rates currently from 5% to 14% p.a.
Tangible assets		Depreciation is calculated by the straight-line method at the following annual rates:
	Land	Nil
	Buildings	2.5%
	Plant and machinery, fixtures, fittings, tools and equipment	At varying rates calculated to write off the assets over their expected useful lives. A substantial part of the group’s plant represents production support facilities depreciated at the same rate, 2.5% p.a., as the buildings in which they are contained. Most of the other assets are depreciated at rates currently from 9% to 12% p.a.
	Assets under construction	Nil

Investments

(a) Trade investments

Trade investments are valued at cost, less any provision for impairment, restated to year end exchange rates if the underlying investment is denominated in foreign currency.

(b) Investments in joint ventures and associated undertakings

A joint venture is an undertaking which the group controls jointly with one or more other venturers.

An associated undertaking is one in which the group has a long term participating interest and over which it exercises significant influence.

The group’s share of the profits less losses of joint venture and associated undertakings is included in the consolidated profit and loss account and its interest in their net assets is included in investments in the consolidated balance sheet.

(c) Company investments

Investments in subsidiary and other undertakings are held at original cost less any provision for impairment, except where they are foreign currency investments hedged in whole or part by related foreign currency borrowings or other hedging instruments. Hedged investments are held at cost less

provision for impairment but are retranslated for foreign exchange movements to the extent that they are hedged. Where the amount of foreign currency hedge is in excess of cost, the investment is stated at the underlying foreign currency net asset value.

Turnover

Turnover consists of royalties and sales of goods and services at invoiced values net of discounts, returns and value added tax. Revenue generated under Technology Transfer agreements is recognised evenly over the life of the agreement. Sales between group companies are excluded.

Revenues are recognised once the realisation of the consideration is reasonably assured and the provision of goods or services is substantially complete with respect to the delivery of the specific product or performance of the related service. This will normally be the case when there are no material uncertainties or performance duties outstanding which could prevent the group from enforcing the sales transaction, and collectability is reasonably assured.

Stocks

Stocks are stated at the lower of cost and net realisable value. Cost is determined on a first in, first out basis and includes all direct expenditure and, in the case of manufactured items, production overheads based on the normal level of business activity. Net realisable value is the price at which the stocks can be realised in the normal course of business after allowing for the costs of realisation and, where appropriate, the costs of conversion. Provision is made for obsolescent and slow moving stocks and for radioactive decay.

Effluent costs

The costs associated with radioactive waste arising from operations for which an authorised disposal route is available, principally low level and very low level waste, are written off in the year in which they are incurred. Provision is also made as incurred for the eventual disposal costs of the group’s intermediate level waste which arises from its operations. These provisions are based on the latest technical assessment of the process and methods likely to be used to dispose of this waste and on industry estimates of the likely costs of the necessary disposal facilities under the relevant Government’s preferred disposal route. They are stated in the balance sheet at current price levels, with the restatement of provisions made in prior years to reflect current price levels included as a charge in the profit and loss account for the year.

Radioactive decommissioning costs

The group recognises in full a provision, (discounted), for the cost of radioactive decommissioning when the relevant fixed asset becomes operational and an equivalent asset is also recognised. The cost of radioactive decommissioning is determined on a going concern basis assuming that the manufacture or handling of radioactive products continues at the relevant site or facility on which the asset is operated for the foreseeable future. In the unlikely event that the company is required to totally discontinue activities at one of its nuclear operating sites the full costs of exiting and decommissioning would be higher. The relevant decommissioning asset is capitalised in the balance sheet in association with the fixed asset to which it relates and is amortised over the life of the asset. The unwinding of the discount on the decommissioning provision is charged in the profit and loss account as part of the interest charge.

Government grants

Investment grants have been treated as deferred income and are released to the profit and loss account at the same rate as the depreciation charge on the assets to which they relate. Revenue grants are matched with the related expenditure.

Taxation

a) Financial years ending 31 December 2001 and 31 December 2002

Taxation charged against profits is calculated at the appropriate local rate of tax for each group company. Except for timing differences relating to revaluations, rolled over taxable gains and unremitted income, provision is made for all timing differences that would give rise to a deferred tax liability. Deferred tax assets are recognised to the extent that it is more likely than not they will be recoverable.

b) Financial years ending 31 December 2000

Taxation charged against profits is calculated at the appropriate local rate of tax for each group company. Provision is made for deferred taxation, using the liability method, on all material timing differences to the extent that it is probable that a liability or asset will crystallise.

Pensions

The group operates defined benefit and defined contribution pension schemes under arrangements which have been separately established by the relevant group company. In respect of the defined benefit schemes, actuarial valuations are made regularly and the contributions payable are adjusted as appropriate.

Pension costs are accounted for on the basis of charging the expected cost of providing pensions over the period during which the group benefits from the employees’ services. The effects of variations from regular cost are spread over the expected remaining service lives of members of the scheme. In respect of defined contribution pension schemes, costs are charged as incurred.

Leases

Rentals payable under operating leases are charged over the lease term on a straight-line basis or on the basis of actual rentals payable where this fairly reflects usage. Rentals receivable are treated as income in the periods to which they relate.

Where assets are financed by leasing arrangements that give rights approximating to ownership, the assets are treated as if they had been purchased outright and the corresponding liability to the leasing company is included as an obligation under finance leases.

Notes to the financial statements

1. Segmental analysis by business sector


	12 months to		12 months to		12 months to
	31 Dec 2002		31 Dec 2001		31 Dec 2000
	£m		£m		£m
Sales
Amersham Health		947.7		922.0		773.9
Amersham Biosciences		670.5		680.5		603.7

		1,618.2		1,602.5		1,377.6


	Included within Amersham Health is the group’s share of Nihon Medi-Physics (NMP) joint venture sales during the year of £80.5m (2001 — £87.3m, 2000 — £94.8m).


Total operating profit before exceptional items and goodwill amortisation
Amersham Health	255.6		240.9		194.6
Amersham Biosciences	75.3		72.4		63.3
Corporate and other	(21.1	)	(20.8	)	(16.7	)

	309.8		292.5		241.2

The following table shows operating profit after allocation of exceptional items and goodwill amortisation. The exceptional items charged in 2002 relate £nil (2001 — £8.5m, 2000 — £10.9m) to Amersham Health, £nil (2001 — £2.6m, 2000 — £3.5m) to Amersham Biosciences and £nil (2001 — £2.4m income, 2000 — £12.6m charge) to Corporate and other. Amortisation charged on goodwill in 2002 relates £0.9m (2001 — £1.4m, 2000 — £1.7m) to Amersham Health, and £35.7m (2001 — £10.3m, 2000 — £9.0m) to Amersham Biosciences.


Total operating profit after exceptional items and goodwill amortisation
Amersham Health	254.7		231.0		182.0
Amersham Biosciences	39.6		59.5		50.8
Corporate and other	(21.1	)	(18.4	)	(29.3	)

	273.2		272.1		203.5


	Included within Amersham Health is the group’s share of the NMP joint venture profit before interest and tax for the year of £23.2m (2001 — £26.1m, 2000 — £29.8m).


	31 Dec 2002			31 Dec 2001			31 Dec 2000
	£m			£m			£m
Net assets
Amersham Health		559.9			451.5			395.9
Amersham Biosciences		1,032.6			413.2			452.0
Corporate and other		(33.7	)		(20.2	)		75.2

Net operating assets		1,558.8			844.5			923.1
Unallocated net liabilities
Current and deferred taxation		(163.6	)		(129.9	)		(106.4	)
Dividends payable		(36.0	)		(30.3	)		(26.9	)
Net debt		(182.3	)		(25.4	)		(323.5	)

		1,176.9			658.9			466.3


	The net assets of Amersham Biosciences include goodwill at a net book value of £630.6m at 31 December 2002 arising from the purchase of the 45% minority interest in Amersham Biosciences.

	Included within the net operating assets of Amersham Health is the group’s share of the NMP joint venture net assets of £73.0m, (2001 — £67.1m, 2000 — £66.1m).

	The net assets of the corporate and other segment contain £nil, (2001 — £2.9m, 2000 — £50.1m) in loan notes. During 2001 fixed assets of £27m previously held in a corporate holding company were merged into the European Health Division.

2. Segmental analysis by geographical sector


	12 months to			12 months to			12 months to
	31 Dec 2002			31 Dec 2001			31 Dec 2000
By origin	£m			£m			£m
Sales
Europe		1,053.9			972.8			825.5
North America		871.8			853.7			743.4
Japan		187.8			202.1			206.8
Asia Pacific		84.0			77.5			58.2
Rest of the world		5.2			6.7			6.9

		2,202.7			2,112.8			1,840.8
Less inter-segment sales		(584.5	)		(510.3	)		(463.2	)

		1,618.2			1,602.5			1,377.6


	Included within Japan is the group’s share of NMP joint venture sales of £80.5m (2001 — £87.3m, 2000 — £94.8m).


Total operating profit before exceptional items and goodwill amortisation
Europe	219.3		193.0		146.9
North America	80.3		89.7		74.5
Japan	31.9		30.4		34.6
Asia Pacific	(0.9	)	(0.3	)	1.8
Rest of the world	0.3		0.5		0.1
Corporate and other	(21.1	)	(20.8	)	(16.7	)

	309.8		292.5		241.2


	The following table shows operating profit after allocation of exceptional items and goodwill amortisation. The exceptional items charged in 2002 relate £nil (2001 — £1.1m, 2000 — £2.6m) to North America, £nil (2001 — £10.0m, 2000 — £11.8m) to Europe and £nil (2001 — £2.4m income, 2000 — £12.6m charge) to Corporate and other.


Total operating profit after exceptional items and goodwill amortisation
Europe	210.4		182.7		135.1
North America	57.6		77.2		61.2
Japan	26.9		30.4		34.6
Asia Pacific	(0.9	)	(0.3	)	1.8
Rest of the world	0.3		0.5		0.1
Corporate and other	(21.1	)	(18.4	)	(29.3	)

	273.2		272.1		203.5


	Included within Japan is the group’s share of NMP joint venture profit before interest and tax for the year of £23.2m (2001 — £26.1m, 2000 — £29.8m).


	31 Dec 2002			31 Dec 2001			31 Dec 2000
	£m			£m			£m
Net assets
Europe		709.3			383.1			302.1
North America		603.0			322.4			374.3
Japan		228.9			107.8			119.3
Asia Pacific		49.5			49.8			50.5
Rest of the world		1.8			1.6			1.7
Corporate and other		(33.7	)		(20.2	)		75.2

Net operating assets		1,558.8			844.5			923.1
Unallocated net liabilities
Current and deferred taxation		(163.6	)		(129.9	)		(106.4	)
Dividends payable		(36.0	)		(30.3	)		(26.9	)
Net debt		(182.3	)		(25.4	)		(323.5	)

		1,176.9			658.9			466.3


	The net assets include goodwill at a net book value of £630.6m at 31 December 2002 arising from the purchase of the 45% minority interest in Amersham Biosciences. The goodwill is


	allocated to Europe, (£207.1m), North America, (£304.1m) and Japan, (£119.4m), based on expected revenues arising in those territories.

	Included within the net operating assets of Japan is the group’s share of the NMP joint venture net assets of £73.0m, (2001 — £67.1m, 2000 — £66.1m).

	The net assets of the Corporate and other segment include an investment of £nil (2001 — £2.9m, 2000 — £50.1m) in loan notes. During 2001, fixed assets of £27m previously held in a corporate holding company were merged into the European Health Division.


	12 months to		12 months to		12 months to
	31 Dec 2002		31 Dec 2001		31 Dec 2000
By destination	£m		£m		£m
Sales
Europe		427.8		392.0		346.6
North America		798.5		767.7		647.2
Japan		264.1		290.7		279.5
Asia Pacific		80.6		80.4		58.1
Rest of the world		47.2		71.7		46.2

		1,618.2		1,602.5		1,377.6


	Included within Japan is the group’s share of NMP joint venture sales during the year of £80.5m (2001 — £87.3m, 2000 — £94.8m).

3. Exceptional items


	12 months to		12 months to			12 months to
	31 Dec 2002		31 Dec 2001			31 Dec 2000
	£m		£m			£m
Cost of the proposed flotation of Amersham Biosciences		—		(3.4	)		(6.4	)
Transfer of pension assets		—		9.0			—
Costs of exiting the disease profiling project		—		(5.8	)		—
Costs of exiting Harwell site		—		(8.5	)		—
Costs of manufacturing rationalisation in Amersham Health		—		—			(10.9	)
Costs associated with the disengagement of Nycomed Pharma		—		—			(9.7	)

Charged to operating profit		—		(8.7	)		(27.0	)
Profit on disposal of 29% of Nycomed Pharma		—		55.3			—

Profit on sale of fixed asset investment		—		55.3			—

Tax credit relating to group reorganisation		9.2		—			—

Total exceptional items		9.2		46.6			(27.0	)

Tax credit related to exceptional items		—		0.5			2.4


	The minority interest impact is £nil (2001 — £2.0m, 2000 — £nil), relating to exceptional items charged to operating profit.

(a) Tax credit relating to group reorganisation.


	As a result of the formation of a consolidated tax group in the US on 31 July 2002, the group has recognised a deferred taxation asset of £9.2m primarily related to the future utilisation of tax losses arising from prior periods.

(b) Proposed partial flotation of Amersham Biosciences.


	Costs of £nil, (2001 — £3.4m, 2000 — £6.4m) were incurred in relation to the proposed partial flotation of Amersham Biosciences. The costs related primarily to adviser fees and other similar costs in preparing the prospectus for flotation and in relocating the business to the US.

(c) Transfer of pension assets.


	In 2001, the company received £22.5m related to a transfer of assets from former pension plans. Of this amount, £13.5m was applied against ongoing liabilities primarily for employees who have transferred into Amersham pension schemes and the balance of £9.0m was recognised as exceptional income, where the company has no further liability.

(d) Costs of exiting the disease profiling project.


	Cash costs of £4.1m and non-cash write offs of £1.7m were incurred in the second half of 2001 in concluding research on, and winding up the operation of an early stage investment in, disease profiling. An investment of £4.0m was made in the research project in the first half of 2001 and £3.7m in the year ended 31 December 2000, which has been charged to operating activities.

(e) Costs of exiting the Harwell site.


	In 2001, costs of £8.5m were accrued in relation to the decision to terminate the group’s lease at the Harwell site following a complete cessation of the group’s activities at this location. The costs relate primarily to asset write offs and decommissioning costs.

(f) Nycomed Pharma.

The sale of Nycomed Pharma to a new company formed for the purpose of the transaction was completed on 14 May 1999. The Group recorded a pre tax gain of £11.5m in the year ended 31 December 1999 after adding back attributable goodwill previously written off to reserves. The tax charge on the disposal amounted to £9.5m. Further costs of £9.7m, with a related tax credit of £1.1m, associated with exiting from the Pharma business, have been accounted for in the year ended December 31, 2000 giving a total loss associated with the disposal of £6.6m after tax in 1999 and 2000. In September 2001 the Group sold its remaining investment in Nycomed Pharma, which consisted of shares and warrants, for £72.4m and realised £50.6m for the outstanding Nycomed Pharma loan notes held by the Group. The Group has recorded a profit on the transaction of £55.3m after charging costs associated with the disposal, including the costs incurred in transferring the Nycomed name to Nycomed Pharma. Subsequent to the transaction the Company changed its name from Nycomed Amersham plc to Amersham plc. The shares in Nycomed Pharma were owned by a legal entity in Holland and under Dutch tax law, the gain on their disposal is not taxable.

(g) Manufacturing rationalisation in Amersham Health.


	In 2000, Amersham Health recorded a charge of £10.9m for the costs of rationalising its radiopharmaceutical production capacity at specific sites in the US and Europe. The costs of the rationalisation comprise cash costs of £8.4m and non-cash write off of £2.5m. No further costs associated with the rationalisation are expected.

4. Total operating profit



	12 months to 31 Dec 2002
	Before
	exceptional			Exceptional
	items			items		Total
	£m			£m		£m
Group turnover		1,537.7			—		1,537.7
Cost of sales		(481.0	)		—		(481.0	)

Gross profit		1,056.7			—		1,056.7
Distribution and selling costs		(419.7	)		—		(419.7	)
Administrative expenses		(387.0	)		—		(387.0	)

Group operating profit		250.0			—		250.0
Share of operating profits of joint venture and associates		23.2			—		23.2

Total operating profit		273.2			—		273.2



	12 months to 31 Dec 2001
	Before
	exceptional			Exceptional
	items			items			Total
	£m			£m			£m
Group turnover		1,515.2			—			1,515.2
Cost of sales		(500.1	)		0.5			(499.6	)

Gross profit		1,015.1			0.5			1,015.6
Distribution and selling costs		(401.8	)		—			(401.8	)
Administrative expenses		(358.6	)		(9.2	)		(367.8	)

Group operating profit		254.7			(8.7	)		246.0
Share of operating profits of joint venture and associates		26.1			—			26.1

Total operating profit		280.8			(8.7	)		272.1



	12 months to 31 Dec 2000
	Before
	exceptional			Exceptional
	items			items			Total
	£m			£m			£m
Group turnover		1,282.8			—			1,282.8
Cost of sales		(431.0	)		(10.9	)		(441.9	)

Gross profit		851.8			(10.9	)		840.9
Distribution and selling costs		(365.9	)		(3.4	)		(369.3	)
Administrative expenses		(285.2	)		(12.7	)		(297.9	)

Group operating profit		200.7			(27.0	)		173.7
Share of operating profits of joint venture and associates		29.8			—			29.8

Total operating profit		230.5			(27.0	)		203.5


	Research and development costs included in administrative expenses relate to Amersham Health £95.1m (2001 — £83.0m, 2000 — £73.9m), Amersham Biosciences £88.0m (2001 — £86.4m, 2000 — £71.5m), and Corporate and other £1.1m (2001 — £4.4m, 2000 — £3.6m). Total research and development costs amounted to £184.2m (2001 — £173.8m, 2000 — £149.0m).

	Goodwill amortisation charged to administrative expenses is £36.6m (2001 — £11.7m, 2000 — £10.7m).


			12 months to			12 months to			12 months to
			31 Dec 2002			31 Dec 2001			31 Dec 2000
			£m			£m			£m
Total operating profit is arrived at after charging:
Remuneration of the group’s auditors
	— Audit fees (company — £0.1m; 2001 — £0.1m; 2000 — £0.1m)			1.6			1.3			1.2
	— Other services to the group
		— in the United Kingdom		0.1			0.2			0.4
		— in the rest of the world (primarily taxation)		0.4			0.2			1.4
Operating lease rentals
	— Hire of plant and machinery			14.5			13.9			12.2
	— Hire of land and buildings and other fixed assets			15.1			14.3			11.5
Amortisation of government grants				(0.2	)		(0.2	)		(0.3	)
Depreciation of tangible fixed assets
	— Owned			72.0			61.1			50.0
	— Held under finance leases			0.3			0.4			0.5
Amortisation of intangible fixed assets
	— Goodwill			36.6			11.7			10.7
	— Other intangibles			7.7			6.8			10.7
Loss on disposal of tangible fixed assets				1.5			0.3			1.1

5. Directors’ emoluments


	12 months to		12 months to		12 months to
	31 Dec 2002		31 Dec 2001		31 Dec 2000
	£m		£m		£m
Basic salary		2.2		1.4		1.3
Fees		0.5		0.4		0.4
Benefits		0.4		0.3		0.2
Annual bonuses		1.2		1.1		0.9
Payments of pension contributions		0.2		0.2		0.1
Compensation for loss of office		0.8		—		—
Payments to past Directors		0.4		0.4		0.2

		5.7		3.8		3.1
Gains made on exercise of share options and long term incentive shares		—		1.4		0.4

		5.7		5.2		3.5

6. Employee information


	The weighted average number of persons (including Executive Directors) employed by the group during the year is analysed by type of work below.


	12 months to		12 months to		12 months to
	31 Dec 2002		31 Dec 2001		31 Dec 2000
	Number		Number		Number
Production and development		4,962		4,587		4,201
Distribution and selling		3,262		3,140		2,834
Administration		1,827		1,792		1,720

		10,051		9,519		8,755


	12 months to		12 months to		12 months to
	31 Dec 2002		31 Dec 2001		31 Dec 2000
	£m		£m		£m
Staff costs
Aggregate gross wages and salaries		376.2		337.3		301.1
Employer’s National Insurance contributions or foreign equivalents		72.5		55.3		43.2
Employer’s pension costs under group pension schemes		27.1		20.9		17.9

Total direct costs of employment		475.8		413.5		362.2

7. Net interest payable


	12 months to			12 months to			12 months to
	31 Dec 2002			31 Dec 2001			31 Dec 2000
	£m			£m			£m
Interest payable and similar charges
On bank loans and overdrafts		(1.9	)		(3.5	)		(9.7	)
On other loans		(6.9	)		(13.3	)		(9.5	)
Unwinding of discount on decommissioning provision		(2.8	)		(2.1	)		(2.2	)

		(11.6	)		(18.9	)		(21.4	)
Interest receivable and similar income
Interest on short term deposits and interest bearing investments		4.5			10.2			11.4

Net interest payable		(7.1	)		(8.7	)		(10.0	)


	Included within interest payable and similar charges, relating to the unwinding of the discount on the decommissioning provision, is £0.6m (2001 — £0.6m, 2000 — £0.6m) attributable to the group’s joint venture in NMP.

8. Tax on profit on ordinary activities

(a) Financial years ending 31 December 2001 and 31 December 2002


		12 months to			12 months to
		31 Dec 2002			31 Dec 2001
	Note	£m			£m
UK corporation tax at 30% (2001 — 30%)
Current			4.0			23.0
Double tax relief			(8.2	)		(15.4	)

			(4.2	)		7.6
Overseas taxation			83.9			69.3
Over-provision in respect of prior years			(18.6	)		(0.6	)
Share of joint venture and associates			10.1			11.7

Total current tax			71.2			88.0

Deferred tax
Origination and reversal of timing differences			7.1			13.8
Prior year deferred tax movement			16.0			(4.8	)

Total deferred tax		<

AMERSHAM PLC 6-K