Philips to work with Bank of America on medical deals

Royal Philips NV is working with Bank of America Corp. as it scouts for acquisitions in medical devices to expand its health-care division, according to people with knowledge of the matter.

While the process is preliminary and no specific targets have been identified, Philips would consider smaller acquisitions as well as multibillioneuro deals over the next six to 12 months, said the people, who asked not to be identified because the plans are private. Shares of Elekta AB, a Swedish device maker, surged the most in more than five years on speculation that it might be a target.

The budget for purchases may increase depending on other potential asset disposals, the people said. The company also could use the proceeds from an initial public offering or sale of its lighting division. Philips is reviewing options for that business, which it plans to sell as soon as next year. Philips is eyeing medical-device companies in areas such as radiotherapy, imaging and home care both in the U.S. and in Europe, the people said.