PALO ALTO, Calif., Aug. 15 -- Agilent Technologies Inc., a maker of electronic test and measurement products, announced today it will sell its Semiconductor Products segment to buyout companies Kohlberg Kravis Roberts & Co. and Silver Lake Partners for $2.66 billion, as part of a restructuring plan that will result in the loss of 1300 jobs.
Agilent also said it has agreed sell its San Jose, Calif.-based lighting company Lumileds to Royal Philips Electronics for $950 million plus $50 million in debt and that it will spin off its SOC (system on a chip) and memory test businesses. The deal will give Amsterdam-based Philips a controlling stake of 96.5 percent of Lumileds; Lumileds employees will own the remaining 3.5 percent.
Agilent said it will return the cash proceeds of the divestitures to its owners through a $4 billion share repurchase program. It said the divestitures will be completed by the end of October, subject to closing conditions, including governmental and regulatory approvals.
Bill Sullivan, president and CEO of Agilent, told investors and press this morning that the moves will enable it to focus solely on the measurement market, in both the electronic and bioanalytical areas. Lumileds, a joint venture Agilent formed with Philips after Agilent's spinoff from HP (Hewlett-Packard) in 1999, has been an "exceedingly successful in developing solid state alternatives to the lighting market," Sullivan said. "This move is very strategic to Philips, and it's the right time to be able to put that back together under Philips."
Sullivan said it plans to cut its global infrastructure costs by $450 million, and that the job cuts will be accomplished through a combination of employee transfers to the divestiture and of spinoff, attrition and work force reduction. It said it expects the restructuring to be completed by the middle of its 2006 fiscal year, and the roughly $200 million implementation cost to be offset by the proceeds of property and other asset sales as the company reduces its global footprint.
For more information, visit: www.agilent.com