Philips to sell Lumileds majority share for $1.5b

Dutch electronics giant Philips announced Monday the sale of a majority share in its Lumileds LED lighting business for $1.5 billion, after cancelling the spinoff earlier this year over US regulatory concerns.

"Royal Philips today announced that it has signed an agreement to sell an 80.1-percent interest in Lumileds to certain funds managed by affiliates of (US-based) Apollo Global Manage-ment," the Amsterdam-based company said in a statement.

Philips said it expected the deal to net the firm approximately $1.5 billion (1.41 billion euros) in cash as well as equity, adding Lumileds is valued at around $2.0 billion.

The new move comes after Philips dropped a planned $2.8-billion sale to Beijing-based GO Scale in January when neither company could convince the US Committee on Foreign Investment (CFIUS) to clear the deal.

"With this transaction, we will be completing an important phase of the transformation of our portfolio and I am satisfied that in the Apollo managed funds we have found the right owner for Lumileds," said Philips chief executive Frans van Houten.

Describing the loss of the earlier GO Scale deal as a "setback", Van Houten told reporters: "We are confident that this time we will succeed."

But Van Houten admitted that "given the backdrop of the CFIUS outcome we had to look for a buyer in a considerably smaller landscape of potential buyers."

"Therefore the premium of the previous process could not be replicated this time," he told reporters.