to merge LED components, auto lighting into standalone
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[June 30, 2014]
By Thomas Escritt
- Dutch lighting and
healthcare company Philips said on Monday it would merge
its Lumileds LED components and automotive lighting
divisions into a standalone subsidiary which could
potentially be spun off.
The company said its lighting division would remain a key customer
for the new subsidiary but that it would look for third-party
investors. It did not rule out becoming a minority shareholder in
the business, which could also be floated.
The decision is the latest stage in Philips' shift from an
electronics company into a healthcare and lighting business. The
company began as an electric lighting pioneer 120 years ago.
Lumileds is a manufacturer of high-powered LED lights, while the
automotive lighting division sells light sources to carmakers and
auto parts and repair stores.
The two businesses had combined sales of about 1.4 billion euros
($1.9 billion) in 2013.
"As a strong standalone company they will have increased flexibility
to attract investments and customers to accelerate growth and to
exploit scale," Philips chief executive Frans van Houten said in a
The process of merging the two divisions into one business, which
will be led by current Lumileds CEO Pierre-Yves Lesaicherre, is
expected to be completed in the first half of 2015 and to cost
Philips about 30 million euros in the second half of 2014.
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Philips and the new subsidiary would continue to collaborate on
research and development, van Houten said.
Philips said it could envisage both equity and debt investors being
interested in the new company.
(1 US dollar = 0.7345 euro)
(Reporting by Thomas Escritt; Editing by Christopher Cushing and
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