AMSTERDAM (dpa-AFX) - Dutch consumer electronics giant Philips Electronics NV (PHGFF.PK, PHG) said Tuesday that it plans to launch an initial public offering of its iconic lighting business on the Euronext stock exchange in Amsterdam.
The intended IPO of Philips Lighting would consist of an offering of existing shares only held by Philips, the current sole shareholder of Philips Lighting.
Philips intends to sell at least 25 percent of the Philips Lighting shares in the IPO. The offering and listing are subject to market conditions, among other factors.
After the IPO, Philips will retain a majority holding in Philips Lighting, with the intention to fully sell down its ownership over the next several years and focus on its HealthTech business.
Frans van Houten, CEO of Royal Philips said, 'Today's announcement is an historic one for Philips as we aim to separate into two market-leading companies focused on capturing opportunities in the health technology and connected LED lighting solutions markets, respectively.'
Philips has appointed Goldman Sachs International and J.P. Morgan Securities plc as joint global coordinators and joint bookrunners for the offering. Citigroup Global Markets Ltd., ING Bank N.V., Morgan Stanley & Co. International plc and Societe Generale Corporate & Investment Banking are acting as joint bookrunners.
Philips first announced plans in 2014 to spin off its lighting business as part of the company's efforts to focus on health care and technology.
Since then, Philips has said it continues to simultaneously prepare for an initial public offering or a private sale of Philips Lighting in a dual-track effort. The company recently noted that an IPO increasingly appears a 'more likely outcome,' with equity markets' sentiment improving compared to the first couple of months of the year.
Philips Lighting, with its registered headquarters in Eindhoven, the Netherlands, has operational manufacturing plants in 22 countries that produces traditional light bulbs and LED lamps. For the year ended December 31, 2015, the business generated sales of 7.47 billion euros and adjusted EBITDA of 547 million euros.
Philips Lighting is targeting an annual dividend pay-out ratio of 40 percent to 50 percent of continuing net income to be paid out in cash. The company expects to make its first dividend payment in 2017, which will be based on the results over fiscal 2016.
Copyright RTT News/dpa-AFX