Philips sells majority interest in lightning business to GO Scale Capital

2015-03-31

THE HAGUE, March 31 (Xinhua) — Dutch electronic giant Philips signed an agreement with GO Scale Capital for the sale of 80.1 percent interest in Philips’ combined LED components and automotive lighting businesses to the Chinese-American investment company, Philips announced on Tuesday.

Philips retained the remaining 19.9 percent interest in the company, which was valued at 3.3 billion U.S. dollars in the deal. Philips expects to receive cash proceeds, before tax and transaction-related costs, of approximately 2.8 billion U.S. dollars and a deferred contingent payment of up to 100 million U.S. dollars.

GO Scale Capital is an investment fund sponsored by China-based GSR Ventures and U.S. based Oak Investment Partners.

Philips’ Lumileds is a major supplier of lighting components to the general illumination, automotive and consumer electronics markets. Following the transaction, the new company will continue under the name Lumileds.

The transaction is expected to be completed in the third quarter of 2015.

Following the deal, Philips Lighting will remain focused on the growing lighting solutions markets.

In September last year, Philips decided to split into two separate independent companies, one for lighting solutions and one combining health care and consumer lifestyle. This separation is still in progress and will take approximately 12 to 18 months.

GSR

Philips revenue in 2015 will be around $20 billions

GO Scale Capital consolidates its resources and provides Lumileds more strategic partners

GO Scale Capital has made a series of investments in companies positioned on the LED supply chain: Lattice Power (epi wafer), TimesLED (epi wafer), ShineOn (package), SunSun Lighting (LED luminaires), and Alighting (LED luminaires and heat dissipation). Once Go Scale Capital has the controlling stake in Lumileds, it may consolidate all its industry-related interests, inserting its new acquisition into the supply chain.

In the past, Lumileds focused on high-power LED production; and when facing the rise of standard and mid-power LED in the market, Lumileds outsourced its manufacturing like other European and American LED companies. LEDinside expects that this cost-saving measure to continue as Lumileds gains strategic partners in China after the takeover.