After bailing out of the last deal with Funai Electric, Royal Philips announced that it will sell its audio, video, multimedia, and accessories business (WOOX Innovations) to Gibson Brands for $135 million, as well as enter into multi-year license agreement.
Philips to Sell AV Business to Funai (1 February 2013)
Philips Scraps AV Business Sale to Funai (31 October 2013)
Funai Says Philips Tried to Sell it a Pig in a Poke (6 December 2013)
Unedited press release follows:
• Philips-branded audio and home entertainment innovations will continue to be available to consumers worldwide
• Transaction supports Gibson Brands’ ambition to become global leader in music and home entertainment
Amsterdam, the Netherlands and Nashville, USA – Royal Philips (NYSE: PHG, AEX: PHIA) today announced that it has signed an agreement regarding the sale of WOOX Innovations, its Audio, Video, Multimedia and Accessories business, to Gibson Brands, Inc., a global music and lifestyle company. Under the terms, Gibson Brands will pay $135 million and a brand license fee, relating to a license agreement for an initial period of 7 years. The deal is expected to close in the second half of 2014, subject to customary conditions, including regulatory filings and works council procedures.
Gibson Brands, based in Nashville, USA, has most recently invested in audio brands including Onkyo and TEAC as part of its ambition to become the global leader in music and sound. This transaction will leverage Gibson Brands’ strong market presence in the U.S. and Japan, and WOOX Innovations’ market strength with Philips-branded audio and home entertainment products in Europe, China, Latin America and other growth geographies.
“With this transaction, we are taking another important step in Philips’ transformation to become a leading technology company in health and well-being,” said Philips Chief Executive Officer Frans van Houten. “Philips and Gibson Brands have played significant roles in shaping the home entertainment and music industries and with this agreement the Philips brand will continue to be associated with innovative products in this space.”
“This agreement is the most significant step yet in Gibson Brands’ journey to become the largest music and sound technology company in the world,” said Gibson Brands Chairman and CEO Henry Juszkiewicz. “By acquiring Philips’ audio and home entertainment business, our goal is to continue to provide the most exceptional consumer audio products and experiences in the world. I am thrilled to extend the reach of Gibson Brands around the world and to welcome this great team to the Gibson family.”
The Video business will stay with Philips until a transfer to Gibson Brands in 2017, related to existing intellectual property licensing arrangements.
WOOX Innovations, headquartered in Hong Kong with approximately 1,900 employees worldwide, is a global and profitable business driving the Philips brand in sound, home entertainment and related accessories.
About Royal Philips:
Royal Philips (NYSE: PHG, AEX: PHIA) is a diversified health and well-being company, focused on improving people’s lives through meaningful innovation in the areas of Healthcare, Consumer Lifestyle and Lighting. Headquartered in the Netherlands, Philips posted 2013 sales of EUR 23.3 billion and employs approximately 112,000 employees with sales and services in more than 100 countries. The company is a leader in cardiac care, acute care and home healthcare, energy efficient lighting solutions and new lighting applications, as well as male shaving and grooming and oral healthcare.
About Gibson Brands:
Gibson Brands, one the fastest-growing companies in the music and sound industries, was founded in 1894 and is headquartered in Nashville, TN. Gibson Brands is a global leader in musical instruments, and consumer and professional audio, and is dedicated to bringing the finest experiences by offering exceptional products with world-recognized brands. Gibson has a portfolio of over 100 well-recognized brand names starting with the number one guitar brand, Gibson. Other brands include: Epiphone, Dobro, Valley Arts, Kramer, Steinberger, Tobias, Slingerland, Maestro, Baldwin, Hamilton, Chickering and Wurlitzer. Audio brands include: KRK Systems, TASCAM, Cerwin-Vega!, Stanton, Onkyo, Integra, TEAC, TASCAM Professional Software, and Esoteric. All Gibson Brands are dedicated to innovation, prestige and improving the quality of life of our customers. News from Gibson is located at www.gibson.com.