The boards of directors of Thermo Electron Corp. and Fisher Scientific have approved a definitive agreement to merge the two companies in a tax-free, stock-for-stock exchange. The new company will be named Thermo Fisher Scientific, Inc. Combining the two companies’ capabilities in technology instrumentation, life science consumables, software and services, Thermo Fisher Scientific is positioned to provide integrated, end-to-end technical solutions, according to a joint statement. The new company will have a global sales and service organization with nearly 7,500 professionals.

Fisher shareholders will receive two shares of Thermo common stock for each share of Fisher common stock they own. Based on Thermo’s closing price on May 5, 2006, this represents an aggregate equity value of $10.6 billion, not including net debt of $2.2 billion. Upon completion of the transaction, Thermo’s shareholders would own approximately 39% of the combined company, and Fisher shareholders would own approximately 61%. The transaction will be treated as a reverse merger, with Thermo as the acquirer.

Marijn E. Dekkers, president and chief executive officer of Thermo, will become president and chief executive officer of the combined company, and Paul M. Meister, vice chairman of the board for Fisher, will become chairman of the board of the combined company. Following the close of the transaction, Paul M. Montrone, chairman and chief executive officer of Fisher, will step aside in support of the new management team. He will concentrate on launching new business opportunities and will remain an adviser to the company. Jim P. Manzi, chairman of the board of Thermo, will serve on the board of directors of the combined company. Thermo Fisher Scientific’s board of directors will be comprised of eight members, with five nominated by Thermo and three nominated by Fisher.

“This combination brings together two well-respected industry leaders in the life, laboratory and health sciences marketplace to create a company that has the product breadth, global reach and operational expertise to drive significant value for shareholders, customers and employees,” said Mr. Dekkers. “Both Thermo and Fisher have strong track records of acquisition success and margin expansion. By combining our companies’ complementary world-class product and service offerings with Fisher’s unparalleled customer access, we expect to accelerate growth by further penetrating our vast customer base.”