Philips Reaches Agreement To Buy Italian Saeco
May 25 2009 - 5:14AM
Dow Jones News
Royal Philips NV (PHIA.AE) Monday said that it reached a binding
agreement to buy Italian espresso machine maker Saeco International
Group SpA, in a move that should give the Dutch company a stronger
position in the higher-end segment of the coffee machine
market.
Philips didn't provide financial details.
The Dutch company said that the completion of the takeover in
part depends on a final agreement with Saeco's banks with which the
Italian company has outstanding credit obligations.
Sunday, Italian newspaper Il Sole 24 Ore reported that Philips
wants to pay EUR200 million for Saeco and is willing to invest an
additional EUR60 million on top of the acquisition sum.
Saeco was founded in 1981 and has 16 subsidiaries, mainly in
Europe and the Americas, according to the company's Web site. It is
owned by France-based private equity firm PAI Partners SAS.
SNS Securities analyst Victor Bareno said that Saeco would make
a good fit within Philips' Domestic Appliances & Personal Care
unit. "Philips is already active in the coffee machine market with
the highly successful Senseo and Saeco would give a complementing
presence in the higher end segment."
Bareno, who rates Philips at reduce, added that the deal shows
that market conditions can offer Philips opportunities to
strengthen its activities through "reasonably priced
acquisitions".
At 0915 GMT, Philips shares traded 0.5% lower at EUR13.72 on an
overall lower AEX market.
Company Web Site: http://www.philips.com
By Maarten van Tartwijk; Dow Jones Newswires; +31 20 571 5201;
maarten.vantartwijk@dowjones.com