Royal Philips has announced that it has signed an agreement with a consortium led by GO Scale Capital through which they will acquire an 80.1% interest in Philips’ combined LED components and automotive lighting business, with Philips retaining the remaining 19.9% interest.
The transaction values the business at an enterprise value of approximately $3.3 billion. The transaction is expected to be completed in the third quarter of 2015, subject to various conditions.
Following the transaction, the new company will continue under the name Lumileds, led by CEO Pierre-Yves Lesaicherre. Philips’ Lighting Solutions business will remain an important customer of Lumileds and will continue the existing innovation and supply partnership.
Lumileds is a leading supplier of lighting components to the general illumination, automotive and consumer electronics markets with operations in more than 30 countries and has approximately 8,300 employees worldwide. In 2014, it generated sales of approximately $2 billion.
GO Scale Capital is a new investment fund sponsored by GSR Ventures and Oak Investment Partners. The consortium partners are Asia Pacific Resource Development, Nanchang Industrial Group and GSR Capital.
Following the separation of Lumileds, Philips Lighting will focus on the lighting solutions markets in which it has leading market positions. In 2014, Philips started the process of creating two companies focused on HealthTech and Lighting Solutions. As part of that strategic repositioning, Philips will transition the Lighting Solutions business into a separate legal structure, and it is the current intention to effect the separation through an initial public offering.
