Under the agreement, Philips will acquire 51 per cent of General Lighting Company from a consortium of stakeholders that includes Alliance Holding, the Hejailan Group, and the Carlyle Group.
The remaining 49 per cent stake will be managed by holding company Alliance, and will be headed up by Abdullah Al-Hobayb, founder and chairman of General Lighting Company.
Philips’ current lighting activities in Saudi Arabia are to be combined with General Lighting Company’s, forming a new business called Philips Lighting Saudi Arabia. The new company will focus on LED products and employ around 1,300 people.
Eric Rondolat, CEO of Philips Lighting, said the partnership will allow Philips to benefit from the Saudi company’s strong knowledge of the local market.
‘By partnering with GLC, Philips will be able to grow its business in this important market, particularly in relation to LED lighting,’ said Rondolat. ‘We expect LED penetration in the Kingdom of Saudi Arabia to achieve strong double-digit growth by 2018, driven by investments in public and private infrastructure.’
The deal is subject to regulatory checks, and is expected to reach be completed later this year.