Shareholders to get €4 billion, Philips to drop Electronics from name - Embedded.com

Shareholders to get €4 billion, Philips to drop Electronics from name

LONDON — Following the sale of its semiconductors business Royal Philips Electronics is to return €4 billion of the €6.4billion it will receive to shareholders by the end of 2007 through a combination of dividends and share repurchases, including the €1.5 billion share repurchase program already announced on July 17.

“With this transaction we have now practically completed our shift towards more stable, cash generative businesses and away from the earnings volatility associated with cyclical industries like components and semiconductors, a journey we started in 2002,” said Gerard Kleisterlee, president and CEO of Philips.

“We close the chapter of being a traditional, vertically integrated electronics company – which is why, going forward, we would like to be known just as Royal Philips. This emphasizes the shift in our focus to a company built around a brand with the promise of 'sense and simplicity' and with a focus on Healthcare and Lifestyle.”

The company will also says it will re-invest in additional opportunities for high-margin growth, both organically and through acquisitions.

In the last 12 months Philips has announced the investment of €3.5 billion in eight acquisitions (some yet to be completed), predominantly in medical systems, lighting and consumer health and wellness.

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