Dutch electronics manufacturer Royal Philips Electronics is reshaping its consumer lifestyle strategy, and as part of this restructuring, has transferred its lifestyle entertainment business to long-time Japanese partner Funai Electric for 150 million euros (US$201.8 million).
In a statement issued on Tuesday, Philips said that it has inked a deal transferring its lifestyle entertainment business--which includes audio, video, multimedia, and accessories--to Funai. In return, the Japanese electronics company will pay 150 million euros (US$201.8 million) and an undisclosed brand license fee that will give it rights for an initial period of five and a half years, with an option to renew for another five, it said.
The deal for the audio, multimedia, and accessories units is expected to close in the second half of 2013, but the video business will transfer in 2017 because of "existing intellectual property licensing agreements," Philips stated. The deal is subject to conditions such as regulatory filings and works council procedures, it added.
Philips CEO Frans van Houten said: "With this transaction, we are taking another step in reshaping the consumer lifestyle portfolio, and transforming Philips into the leading technology company in health and well-being."
"I am confident that today's agreement with Funai, our partner for over 25 years, will create a promising future for Philips audio, video, and entertainment, and continuity for our customers."
Funai said that with Philips' technical know-how and global reach, it would be able to meet its goal of expanding its business into markets such as Brazil, Russia, India, and China.
The deal is another step Philips is taking to rejuvenate its business. Last September, it said that it had raised its cost-cutting plans to 1.1 billion euros (US$1.4 billion), and revealed plans to cut a further 2,200 jobs in addition to the 4,500 jobs it had announced in 2011.