McKesson to Sell Its Acute Care Medical-Surgical Distribution Business to Owens & Minor; Move Will Allow McKesson to Focus on the Growing Alternate Site Market

Although it is divesting its hospital supply business, McKesson'sMedical-Surgical business unit will continue to serve the growingalternate site market, which includes physician offices, clinics,surgery centers, nursing homes, home care and occupational healthfacilities.

Under the arrangement, Owens & Minor will acquire all ofMcKesson's assignable acute care customer contracts, as well asrelated inventory and fixed assets.

In May, McKesson publicly announced its intentions to seekstrategic alternatives for its acute care business. "We considered allof our options and after a careful analysis, determined that ourcustomers, our company and our shareholders would best be served if wesold acute care to an industry leader like Owens & Minor," said JohnHammergren, Chairman and CEO of McKesson. "This strategic decisionwill provide our hospital customers -- many of whom we will continueto serve through our other businesses -- with the high levels ofquality and service they've come to expect from McKesson. And, it willallow us to better focus our energies on the rapidly growing alternatesite market, where McKesson is already a leading supplier."

"We are excited about the opportunity to further expand ouralternate site business, and have already begun to sharpen our focuson this higher growth, higher margin part of the market," said BrianTyler, president of McKesson Medical-Surgical. "We look forward tobuilding on our industry leadership to provide our alternate sitecustomers with the best service and best value in the industry."

McKesson's Medical-Surgical business delivers a comprehensiveoffering of healthcare products, equipment and related servicesspanning the continuum of care from physician offices and surgerycenters, to long-term care facilities and home care businesses acrossthe country.

Risk Factors

Except for historical information contained in this press release,matters discussed may constitute "forward-looking statements", withinthe meaning of Section 27A of the Securities Act of 1933 and Section21E of the Securities Exchange Act of 1934, that involve risks anduncertainties that could cause actual results to differ materiallyfrom those projected, anticipated or implied. These statements may beidentified by their use of forward-looking terminology such as"believes", "expects", "anticipates", "may", "should", "seeks","approximates", "intends", "plans", "estimates" or the negative ofthese words or other comparable terminology. The most significant ofthese risks and uncertainties are described in the company's Form10-K, Form 10-Q and Form 8-K reports filed with the Securities andExchange Commission and include, but are not limited to: adverseresolution of pending shareholder litigation regarding the 1999restatement of our historical financial statements; the changing U.S.healthcare environment, including changes in government regulationsand the impact of potential future mandated benefits; competition;changes in private and governmental reimbursement or in the deliverysystems for healthcare products and services; governmental andmanufacturers' efforts to regulate or control the pharmaceuticalsupply chain; changes in pharmaceutical and medical-surgicalmanufacturers' pricing, selling, inventory, distribution or supplypolicies or practices; changes in the availability or pricing ofgeneric drugs; changes in customer mix; substantial defaults inpayment or a material reduction in purchases by large customers;challenges in integrating and implementing the company's internallyused or externally sold software and software systems, or the slowingor deferral of demand or extension of the sales cycle for externalsoftware products; continued access to third-party licenses forsoftware and the patent positions of the company's proprietarysoftware; the company's ability to meet performance requirements inits disease management programs; the adequacy of insurance to coverliability or loss claims; new or revised tax legislation; foreigncurrency fluctuations or disruptions to foreign operations; thecompany's ability to successfully identify, consummate and integratestrategic acquisitions; changes in generally accepted accountingprinciples (GAAP) and general economic conditions. The reader shouldnot place undue reliance on forward-looking statements, which speakonly as of the date they are made. The company assumes no obligationto update or revise any such statements, whether as a result of newinformation or otherwise.

About Owens & Minor

Owens & Minor, Inc. (NYSE: OMI), a FORTUNE 500 companyheadquartered in Richmond, Virginia, is the leading distributor ofnational name-brand medical and surgical supplies and a healthcaresupply chain management company. With a diverse product and serviceoffering and distribution centers throughout the United States, thecompany serves hospitals, integrated healthcare systems, alternatecare locations, group purchasing organizations, the federal governmentand consumers. Owens & Minor provides technology and consultingprograms that enable healthcare providers to maximize efficiency andcost-effectiveness in materials purchasing, improve inventorymanagement and streamline logistics across the entire medical supplychain -- from origin of product to patient bedside. The company alsohas established itself as a leader in the development and use oftechnology. For news releases, or for more information about Owens &Minor, visit the company Web site at www.owens-minor.com.

About McKesson

McKesson Corporation (NYSE:MCK), currently ranked 16th on theFORTUNE 500, is a healthcare services and information technologycompany dedicated to helping its customers deliver high-qualityhealthcare by reducing costs, streamlining processes and improving thequality and safety of patient care. Over the course of its 173-yearhistory, McKesson has grown by providing pharmaceutical andmedical-surgical supply management across the spectrum of care;healthcare information technology for hospitals, physicians, homecareand payors; hospital and retail pharmacy automation; and services formanufacturers and payors designed to improve outcomes for patients.For more information, visit us at www.mckesson.com.