Philips' fillip

12 December 2016 By Dominic Elliott

Apollo has bought the Dutch company’s LED and car lighting business for $2 bln. That’s 40 pct below a Chinese bid that American regulators blocked on security grounds. Buyout firms can’t easily outbid cash-rich Eastern investors. At least they can sometimes pick up the crumbs.

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Philips on Dec. 12 agreed to sell 80 percent of its LED components and car lighting business to U.S. private equity firm Apollo Global Management for $1.5 billion.

The Dutch company said the price valued its business, known as Lumileds, at $2 billion, including debt, and that Philips' remaining stake would be held in the form of preference shares.

An agreement made 18 months ago to sell the business to a Chinese consortium had given Lumileds a far higher enterprise value of $3.3 billion, but the deal was blocked by the Committee on Foreign Investment in the United States, an arm of the U.S. Treasury Department.

By 0901 GMT, shares in Philips were trading at 27.77 euros, down 0.9 percent from their previous close.

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