Philips Completes NXP Sale

By Suzanne Deffree -- Electronic News, 9/29/2006

It’s official: Philips Semiconductors is no longer majority owned by Royal Philips Electronics.

Royal Philips Electronics today announced it has completed its sale of an 80.1 percent stake in its semiconductors business to a private equity consortium consisting of Kohlberg Kravis Roberts & Co., Silver Lake Partners, Bain Capital, Apax Partners and AlpInvest Partners NV.

Under the terms of the agreement, which was announced in August, Philips sold the majority stake in its semiconductors business in a more than $10 billion (8.3 billion euros) deal.

After taxes, Philips expects to receive approximately $8.2 billion (6.4 billion euros) in cash.

The standalone semiconductor business became NXP -- which stands for Next Experience -- at the beginning of September. Frans van Houten, formerly the head of Philips Semiconductors, moved with NXP and is now president and CEO of the new company. With today’s transaction complete, van Houten relinquishes his position as member of the board of Royal Philips Electronics
 
Philips said that it will treat its semiconductors activities as "Discontinued Operations" in the company's Q3 report, slated to be published on October 16.

Philips will maintain the minority 19.9 percent stake in NXP.