Philips to sell ma­jor stake in LED, car light­ing arm for US$2.8 bil.: state­ment

The China Post - - WORLD BUSINESS -

Dutch elec­tron­ics gi­ant Philips on Tues­day said it was sell­ing a ma­jor­ity stake in its LED and car light­ing arm to a con­sor­tium led by Chin­abased GO Scale Cap­i­tal in­vest­ment fund in a deal worth US$2.8 bil­lion.

“Philips to­day an­nounced that it has signed an agree­ment with a con­sor­tium led by GO Scale Cap­i­tal through which they will ac­quire an 80.1 per­cent in­ter­est in Philips’ com­bined LED com­po­nents and au­to­mo­tive light­ing busi­ness,” the Am­s­ter­dam-based Philips said.

“Philips ex­pects to re­ceive cash pro­ceeds, be­fore tax and trans­ac­tion re­lated costs, of ap­prox­i­mately US$2.8 bil­lion,” it said in a state­ment.

Af­ter the sale, to be com­pleted in the third quar­ter of the year, Philips will re­tain a 19.9 per­cent share in the busi­ness, it added.

Philips last year an­nounced it would split in two, sep­a­rat­ing its health­care-life­style arm from its his­toric light­ing sec­tion in a move to stream­line the 120-year-old busi­ness.

Part of the split in­cluded cre­at­ing a sep­a­rate com­pany for some of its light­ing ac­tiv­i­ties, par­tic­u­larly for its LED and car light­ing branches, to be branded un­der the name of Lu­mileds.

“We are con­vinced that to­gether with GO Scale Cap­i­tal, Lu­mileds can grow fur­ther, at­tract more cus­tomers and in­crease scale as a stand-alone com­pany,” Philips chief ex­ec­u­tive Frans van Houten said on Tues­day.

“We feel very com­fort­able to hand over 80 per­cent of the shares ... to this con­sor­tium which has a proven track record,” Van Houten told jour­nal­ists in an early-morn­ing con­fer­ence call.

Lu­mileds is a lead­ing sup­plier of gen­eral, car and con­sumer light­ing com­po­nents and op­er­ates in 30 dif­fer­ent coun­tries, em­ploy­ing some 8,300 peo­ple world-wide.

Founded in 1891 in the south­ern Dutch city of Eind­hoven, Philips it­self em­ploys around 112,000 peo­ple glob­ally.

GO Scale Cap­i­tal is a new in­vest­ment fund spon­sored by GSR Ven­tures and Oak In­vest­ment Part­ners with of­fices in Bei­jing, Hong Kong and Sil­i­con Val­ley.

It’s cur­rent in­vest­ments in­clude U.S.-based Bos­ton Power, which makes elec­tric ve­hi­cle bat­ter­ies and China-based Xin Da Yang which pro­duces elec­tric ve­hi­cles.

“GO Scale Cap­i­tal will fo­cus on ex­pand­ing Lu­mileds’ op­por­tu­ni­ties by in­vest­ing in its global cen­ters of op­er­a­tion and in the fast grow­ing gen­eral light­ing and au­to­mo­tive in­dus­tries,” GO Scale Cap­i­tal chair­man Sonny Wu said in Tues­day’s state­ment.

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