From vacuum cleaners to coffee machines, from deep fryers to irons – Philips domestic appliances are known for their design and their frequently innovative technology. The Dutch company, which is headquartered in Amsterdam, now intends to focus on the healthcare technology sector and is therefore divesting itself of its domestic appliances division. The division, for which Philips reported a turnover of 2.2 billion euros in 2020, will be sold to the Asia-focused investment firm Hillhouse Capital. The transaction is expected to be completed in the third quarter of 2021, subject to closing conditions and relevant official approvals.
Hillhouse Capital is reported to be paying 3.7 billion euros for the division. Additionally, the companies will be signing an exclusive trademark licence agreement allowing the global use of the Philips brand, and of certain other domestic appliance brands owned by Philips, for the production, distribution and marketing of domestic appliance products for a period of 15 years, with an option to extend the agreement beyond this period. The annual payments anticipated for this period represent an estimated 700 million euros, bringing the total value of the agreement to approximately 4.4 billion euros. “This transaction concludes our larger divestments,” said the CEO of Philips, Frans van Houten. “Going forward, our focus is on extending our leadership in health technology,” he added. The Dutch company announced the sale of its domestic appliances division last year. It had already divested itself of other divisions, such as those covering the production of TV and audio equipment and lightbulbs. The lighting division, for example, was listed on the stock exchange as Signify in 2018.
Share this post on Social Media: