Philips sells audio, video arms to Funai for $202 million
updated 10:23 am EST, Tue January 29, 2013
Completes move 'away from consumer electronics,' into appliances
Philips is selling the remainder of it's home entertainment arm in order to focus on more profitable areas of the business, namely home appliances and healthcare. The audio and video section of the Dutch firm will be sold to Funai Electric Co of Japan for 150 million euro ($202 million), with chief executive Frans va Houten claiming it to be "margin dilutive."
The shrinking consumer electronics business sale is claimed by Reuters to be down to people using the Internet for music and other media instead of buying physical counterparts. Though it was profitable last year, the remaining audio and video section sale was not doing enough to be worth continuing, with van Houten saying "This completes the repositioning away from consumer electronics." Philips has already sold off its TV business to China's TPV last year, though it retained a 30-percent stake in the business.
The company is said to have reported a fourth-quarter net loss of 355 million euro ($478 million), double that of the same period last year. It is also needing to find the funds to pay 509 million euro ($686 million) in fines from the European Union, received due to its part in a television cartel. Despite these, shares in Philips rose 1.4 percent to 22.2 euros ($29.90), the company's highest level of trading since April 2011.
