THE FOLLOWING PRESS
RELEASE WAS ISSUED ON NOVEMBER 26, 2007.
PHILIPS ANNOUNCES AGREEMENT TO ACQUIRE GENLYTE A LEADING
NORTH AMERICAN LUMINAIRES MANUFACTURER
-
Philips to pay approximately USD
2.7 billion (EUR 1.8 billion) based on an offer price per share of USD 95.50
-
Deal
creates #1 lighting company in North America
-
Philips and Genlyte to grow business
by introducing Philips innovative, greener and solid state lighting technologies in
North
America through Genlytes extensive contacts with distributors, architects and
designers, and by introducing Genlytes
products to an international market
-
Deal leverages Philips earlier successful acquisitions of Color Kinetics,
Partners in Lighting, TIR and Lumileds, and
signals continuing investment in
Lighting
-
Genlyte's Board of Directors will unanimously recommend offer to shareholders
Amsterdam, the Netherlands and
Louisville, Kentucky
Royal Philips Electronics (AEX: PHI, NYSE: PHG)
(Philips) today announced it has entered into a definitive merger agreement
with North American luminaires company Genlyte Group Incorporated (Genlyte)
(NASDAQ: GLYT) pursuant to which Philips will commence a tender offer to acquire all of
the issued and outstanding shares of Genlyte for USD 95.50 per share, or approximately USD
2.7 billion (EUR 1.8 billion) to be paid in cash upon completion. The proposed transaction
builds on Philips earlier acquisition of Color Kinetics and provides the company
with a leading position in the North American luminaires (also known as lighting
fixtures) market. The deal will also provide Philips with a platform for further
profitable growth by building on Genlytes extensive presence among lighting
customers in North America to speed up the adoption of energy-saving, green lighting
technologies. The board of directors of Genlyte has unanimously approved the transaction,
and will unanimously recommend that Genlyte shareholders accept the offer and tender their
shares of Genlyte pursuant to the offer.
Based in Louisville, Kentucky, USA,
Genlyte designs, manufactures and sells lighting fixtures, controls and related products
for a wide variety of applications, including solid state lighting. Just under 90% of
Genlytes 2006 revenues were related to commercial and industrial applications, with
the remainder for high-end residential applications. A leader in the North American
construction luminaires market, Genlyte sells to distributors and electrical wholesalers.
The companys products are also promoted through architects, engineers, contractors,
and building owners. Genlyte employs approximately 6700 people.
Commenting on the announcement, Theo
van Deursen, Chief Executive Officer of Philips Lighting, said: Todays
announcement is another major step for Philips in executing its strategy to establish a
global leadership position as a provider of energy efficient, solid state lighting
solutions in key application areas. It follows on our recent acquisitions of Color
Kinetics, TIR Systems, Partners in Lighting International, as well as our earlier
investment to acquire full ownership of LumiLeds. Besides growing our presence in North
America, this deal deepens our contacts to end users, such as wholesalers, contractors,
architects and lighting designers, helping us speed up the market rollout of more energy
efficient lighting and the introduction of new lighting technologies, like solid state
lighting.
Larry K. Powers, Chairman, President
and Chief Executive Officer of Genlyte Group Incorporated added, Philips is shaping
the future of the lighting industry by building up an extensive portfolio of innovative,
green lighting. Genlyte has also established a reputation for developing innovative new
products utilizing the latest in lamp and ballast technologies. We believe joining with
Philips is in the best interest of our shareholders, customers, vendors and employees, and
that our combined resources will produce the best possible entity for competing, growing
and creating value for our customers. We view this merger as an exciting opportunity for
everyone, and as a result the Board will recommend the offer to our shareholders.
Over a 12-month period ending in
September 2007, Genlyte had sales of approximately USD 1.6 billion with an EBITA margin of
14.9%. Following completion of the acquisition, Philips expects Genlytes revenue
growth to continue outpacing the market, as Philips uses Genlytes market presence as
a platform for introducing newer, green products into the North American market.
Philips plan to extend Genlytes activities beyond North America will also
contribute to growth. Following the integration of Genlyte, Philips expects to benefit
from leveraging
economies of scale in purchasing of materials and services as well as
Genlytes expertise in outsourcing and streamlining of manufacturing activities,
contributing to margin expansion.
The acquisition is structured as an
all cash tender offer by Philips for all of the issued and outstanding shares of Genlyte
to be followed by a merger in which each remaining untendered share of Genlyte will be
converted into the same USD 95.50 per share price paid in the tender offer. The tender
offer is expected to commence within 5 business days and is not subject to a financing
contingency. The acquisition will be effected pursuant to a merger agreement and is
subject to the terms and conditions of the merger agreement. These include the tender of a
majority of the outstanding Genlyte shares on a fully-diluted basis and other customary
conditions. The transaction is expected to close in the first quarter of 2008, upon which
Genlyte will be integrated into the Luminaires business group within Philips Lighting.
At 10.00 AM CET today, financial
analysts are invited to join a telephone conference with Pierre-Jean Sivignon, Chief
Financial Officer of Royal Philips Electronics and Theo van Deursen, Chief Executive
Office of Philips Lighting. A live webcast of this conference call will be made available
on Philips Investor Relations website at:
http://www.philips.com/about/investor
At 11.30 AM CET today, journalists
are invited to join a telephone briefing with Mr. Theo van Deursen. A live webcast of this
briefing will be made available on Philips News Center website at:
http://www.newscenter.philips.com
For further information, please
contact:
Jayson Otke
Philips Corporate Communications
Tel: +31 20 59 77215
Email:
jayson.otke@philips.com
David Wolf
Philips Corporate Communications North America
Tel: +1 917 455 7857
Email:
david.l.wolf@philips.com
Raymond L. Zaccagnini
Genlyte Group
Tel: +1 502 420 9500
Email:
rzaccagnini@genlytegroup.com
About Royal Philips
Electronics
Royal Philips Electronics of the
Netherlands (NYSE: PHG, AEX: PHI) is a global leader in healthcare, lighting and consumer
lifestyle, delivering products, services and solutions through the brand promise of
sense and simplicity. Headquartered in the Netherlands, Philips employs
approximately 128,100 employees in more than 60 countries worldwide. With sales of EUR 27
billion in 2006, the company is a market leader in medical diagnostic imaging and patient
monitoring systems, energy efficient lighting solutions, personal care and home
appliances, as well as consumer electronics. News from Philips is located at
www.philips.com/newscenter.
About Genlyte Group
Incorporated
The Genlyte Group Incorporated (Nasdaq:
GLYT) is a leading manufacturer of lighting fixtures, controls, and related products for
the commercial, industrial and residential markets. Genlyte sells lighting and lighting
accessory products under the major brand names of Alkco, Allscape, Ardee, Canlyte,
Capri/Omega, Carsonite, Chloride Systems, Crescent, Dac, Day-Brite, Gardco, Guth,
Hadco, Hanover Lantern, High-Lites, Hoffmeister, Lam, Ledalite, Lightolier, Lightolier
Controls, Lumec, Morlite, Nessen, Quality, Shakespeare Composite Structures, Specialty,
Stonco, Strand, Thomas Lighting, Thomas Lighting Canada, Vari-Lite, Vista, and Wide-Lite.
Forward-looking statements
This release may contain certain
forward-looking statements with respect to the financial condition, results of operations
and business of Philips and certain of the plans and objectives of Philips with respect to
these items, including without limitation completion of the tender offer and merger and
any expected benefits of the merger. Completion of the tender offer and merger are subject
to conditions, including satisfaction of a minimum tender condition and the need for
regulatory approvals, and there can be no assurance those conditions can be satisfied or
that the transactions described in this press release will completed. By their nature,
forward-looking statements involve risk and uncertainty because they relate to events and
depend on circumstances that will occur in the future and there are many factors that
could cause actual results and developments to differ materially from those expressed or
implied by these forward-looking statements.
Additional Information
The tender offer described in this
press release has not yet commenced, and this press release is neither an offer to
purchase nor a solicitation of an offer to sell Genlytes common stock. Investors and
security holders are urged to read both the tender offer statement and the
solicitation/recommendation statement regarding the tender offer described in this press
release when they become available because they will contain important information. The
tender offer statement will be filed by Philips with the Securities and Exchange
commission (SEC) and the solicitation/recommendation statement will be filed
by Genlyte with the SEC. Investors and security holders may obtain a free copy of these
statements (when available) and other documents filed by Philips or Genlyte with the SEC
at the website maintained by the SEC at
www.sec.gov
. The tender offer statement and
related materials, solicitation/recommendation statement, and such other documents may be
obtained for free by directing such requests to Investor Relations of Genlyte at
irelations@genlytegroup.com
.
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