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         THERMO ELECTRON PROPOSES CORPORATE REORGANIZATION

WALTHAM, Mass., August 12, 1998 -- Thermo Electron Corporation (NYSE-TMO) today
announced that its board of directors has authorized a proposed corporate
reorganization. The goals of the plan are to:

        *Reduce the complexity of the company's corporate structure,
        *Consolidate and strategically realign certain businesses to enhance
        their competitive market positions and improve management coordination,
        and
        *Increase the liquidity in the public markets for stock of the company's
        publicly traded subsidiaries by providing larger market floats.

      The proposed reorganization is expected to reduce the number of Thermo
Electron's majority-owned public subsidiaries from 23 to 15. The company expects
to promptly begin implementation of the reorganization, although it may take up
to two years to complete all aspects of the plan.

      George N. Hatsopoulos, chairman of Thermo Electron, said, "We firmly
believe that spinouts continue to offer many advantages. The strategy is dynamic
- allowing us to respond to changes in the marketplace and revamp those parts of
the structure that no longer meet our goals for a public subsidiary. In some
cases, the potential rewards for some of our companies have become out of line
with the risks. We will continue to closely monitor the performance of our
spinouts to assess their viability in the public markets. I wish to stress that
the benefits we anticipate from this reorganization are long term. We do not
anticipate any material benefits in the short term."

      John N. Hatsopoulos, president and chief financial officer of Thermo
Electron, added, "Our number one goal for this plan is to simplify our company.
We also expect that larger, more closely aligned businesses will strengthen our
competitive positions. Larger size should create better liquidity for investors
by increasing the public float, and, we believe, keep in proper perspective some
of the problems experienced by our smaller subsidiaries."

      The proposed corporate reorganization is best outlined in four general
categories:

    1.Reorganization of biomedical businesses. The wholly owned biomedical
      group of Thermo Electron, called Thermo Biomedical, would be transferred
      to Thermo Electron's Thermedics subsidiary to better position the company
      to expand its presence in that marketplace, while creating a focused
      company for healthcare investors. Thermo Biomedical, which includes Bear
      Medical Systems Inc.; Bird Products Corporation; Bird Life Design
      Corporation; Stackhouse Inc.; SensorMedics Corporation; Medical Data
      Electronics, Inc.; and Nicolet Biomedical Inc., had unaudited 1997
      revenues of

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      $232 million. These companies would be transferred from Thermo Electron
      to Thermedics in exchange for Thermedics shares.

    2.Realignment of instrument companies. First, Thermedics' non-biomedical
      public subsidiaries - Thermo Sentron, Thermedics Detection, and Thermo
      Voltek (if not sold to an unaffiliated third party) - would be transferred
      to Thermo Electron's Thermo Instrument Systems subsidiary, creating
      efficiencies by aligning these industrial instrumentation businesses with
      the instrument family of companies for a better strategic fit. Thermedics'
      majority ownership in each of these subsidiaries would be transferred to
      Thermo Electron for shares of Thermedics common stock held by Thermo
      Electron. Thermo Electron, in turn, would transfer these equity interests
      to Thermo Instrument Systems in exchange for cash. If Thermo Voltek is not
      sold to an unaffiliated third party, it would become a wholly owned
      subsidiary of Thermo Instrument Systems.
           Second, two public Thermo Instrument Systems subsidiaries - Metrika
      Systems and ONIX Systems - and Thermo Sentron, would be merged to form one
      combined majority-owned public subsidiary of Thermo Instrument Systems.
      The company believes that the combined entity, with complementary
      products, technologies, and distribution networks, would be better able to
      address the market for industrial sensors and advanced process control
      systems. Shareholders of each of the three companies would receive shares
      of common stock in the combined entity in exchange for their shares in the
      subsidiaries.
           Third, ThermoSpectra, a public subsidiary of Thermo Instrument
      Systems, along with Thermedics Detection, would be taken private and
      become wholly owned subsidiaries of Thermo Instrument Systems.
      ThermoSpectra and Thermedics Detection shareholders would receive cash or
      Thermo Instrument Systems common stock in exchange for their shares of
      common stock of ThermoSpectra or Thermedics Detection.

    3.Consolidation of industrial outsourcing companies. The public and private
      subsidiaries of Thermo Electron's Thermo TerraTech subsidiary - Thermo
      Remediation, The Randers Group, and Thermo EuroTech - would be
      consolidated into Thermo TerraTech to strengthen the group's ability to
      compete in the industrial and environmental outsourcing markets, as well
      as enhance their ability to withstand adverse market conditions.
      Shareholders of each of these subsidiaries would receive common stock in
      Thermo TerraTech in exchange for their shares in the subsidiaries.

    4.Other strategic reorganizations. Thermo Coleman, a private subsidiary of
      Thermo Electron, would be merged into Thermo Electron's ThermoTrex
      subsidiary, consolidating the company's R&D and government-contract work
      within one entity to offer greater efficiencies and enhance opportunities
      to develop and commercialize technologies. Thermo Coleman shareholders
      would receive shares of ThermoTrex common stock in exchange for their
      Thermo Coleman shares.
           Also, Thermo Power, a public subsidiary of Thermo Electron, would be
      taken private and become a wholly owned subsidiary of Thermo Electron.
      Shareholders of Thermo Power would receive cash or Thermo Electron common
      stock in exchange for their shares of Thermo Power common stock.

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      All convertible debentures previously issued by subsidiaries that will no
longer be majority-owned entities following this reorganization will be assumed
by the surviving public parent company, and will be convertible into common
stock of that company. Thermo Electron's guarantee of each of these convertible
debentures will not be affected by the proposed reorganization.

      While these transactions will generate numerous costs, including
investment banking fees, legal fees, and government filings, the company does
not believe that any significant restructuring charges will be necessary.

      The company also plans to divest of certain non-strategic businesses,
totaling approximately $100 million in revenues, that no longer fit its profile
for long-term growth potential.



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                 Proposed Corporate Reorganization
               Boldface type indicates public entity (*)

*Thermo Electron                    *Thermo Instrument
      Thermo Power                        Thermedics Detection
      Tecomet                             ThermoSpectra
      Peter Brotherhood                   Thermo Voltek
      Napco                              *ThermoQuest 
                                         *Thermo BioAnalysis
*Thermo Ecotek                           *Thermo Optek 
                                         *Thermo Vision 
*Thermo Fibertek                         *New Co. (Thermo Sentron,
     *Thermo Fibergen                     Metrika Systems, ONIX Systems)

*Thermo TerraTech                    *ThermoTrex
      Thermo Remediation                  Thermo Coleman
      Randers Group                      *Trex Medical
      Thermo EuroTech                    *ThermoLase

*Thermedics
      Thermo Biomedical
     *Thermo Cardiosystems

      All of these transactions will be subject to numerous conditions,
including establishment of prices and exchange ratios, confirmation of
anticipated tax consequences, approval by the board of directors (including the
independent directors) of each of the affected majority-owned subsidiaries,
negotiation and execution of definitive purchase and sale or merger agreements,
clearance by the Securities and Exchange Commission of registration statements
and/or proxy materials regarding the proposed transactions, and, where
appropriate, fairness opinions from investment banking firms. Any such
transactions that will involve a public offering of securities will be made only
by means of a prospectus.


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      Thermo Electron Corporation is a world leader in analytical and monitoring
instruments; biomedical products including heart-assist devices,
respiratory-care equipment, and mammo-graphy systems; and paper recycling and
papermaking equipment. The company also develops alternative-energy systems and
clean fuels, provides a range of services including industrial outsourcing and
environmental-liability management, and conducts research and development in
advanced imaging, laser communications, and electronic information-management
technologies. With annual worldwide sales of $3.6 billion, Thermo Electron has
approximately 22,000 employees and operations in 23 countries. Headquarters are
in Waltham, Massachusetts. More information is available on the Internet at
http://www.thermo.com.

This press release contains forward-looking statements that involve a number of
risks and uncertainties. Important factors that could cause actual results to
differ materially from those indicated by such forward-looking statements are
set forth under the heading "Forward-looking Statements" in Exhibit 13 to the
company's annual report on Form 10-K, as amended, for the year ended January 3,
1998. These include risks and uncertainties relating to: the company's spinout
and acquisition strategies, competition, international operations, technological
change, possible changes in governmental regulations, regulatory approval
requirements, capital spending and government funding policies, dependence on
intellectual property rights, and the potential impact of the year 2000 on
processing date-sensitive information. In addition to the foregoing risks, the
proposed corporate reorganization is subject to the risk that the contemplated
benefits of the plan will not be achieved.