Philips leaves the production of incandescent lamp

Centre and twenty-three years after the first unit out of its production line, Philips will manufacture incandescent bulbs. The decision is part of the plan to split its operations in two and seek a greater growth potential in the area of health technology.
The Dutch electronics group said yesterday that it will transform its lighting operations in a separate company-ending more than a century of expertise as electronics conglomerate-while maintaining a health technology unit for the production of items such as electric shavers and hospital equipment.
Philips also said it will consider "alternative control structures with direct access to capital markets" for the new independent group of lighting-including an initial public offering of shares.
Frans van Houten, Chief Executive, said that the directors of Philips did not adopt the measure of light way, given their status as one of the oldest companies of electronics in the world: "this is a very important decision, because of our strong heritage".
The decision will break the historic link between electronic operations remnants of Philips and its origins in 19th-century manufacturer of incandescent bulbs. The Dutch group was founded in Eindhoven in 1891 by Gerard Philips and his father Frederick, transforming into a global conglomerate. "The good companies need to reinvent itself to remain relevant," says van Houten.
Over the past decade, Philips became leaner, in an attempt to improve their low rate of growth. In 2006, dismembered their Semiconductor Division-is now called NXP Semiconductors-and, in 2012, sold its operations with televisions. But the company said adjusted earnings before interest, taxes and amortization for the rest of the company in the second half of 2014 should be "slightly below" last year.
Yesterday, investors welcomed the breakup proposal, leading to the Philips action rising 3.5% to € 24,35.