In a move seen as a continuation of its renewed focus on healthcare, Royal Philips said it has reached a deal worth $3.3 billion to sell an 80.1% stake in its LED components and automotive lighting business.
Philips said it reached the agreement with a consortium led by GO Scale Capital, a new investment fund sponsored by GSR Ventures and Oak Investment Partners. The new company will be called Lumileds, with Philips retaining a 19.9% interest. Lumileds will be led by CEO Pierre-Yves Lesaicherre.
In announcing the deal, Philips said it believed that Lumileds will function more effectively as a standalone company. The new business has approximately 8,300 employees worldwide, and it generated sales of approximately $2 billion in 2014.
Philips will retain its Philips Lighting business, which will focus on segments in the lighting market in which the company has leading market positions. As announced in September 2014, Philips has begun creating two companies, HealthTech and Lighting Solutions, with the lighting unit becoming its own company through an initial public offering.