Report: Philips Chip Unit Bids Climb to $10.2B

Three groups bidding for Koninklijke Philips Electronics’ chip division are in the final stages of a deal that could be priced around 8 billion euros (US$10.2 billion), The Wall Street Journal reports, citing people familiar with the situation.

The company’s semiconductor division produces chips for a variety of gadgets, including LCD TVs and other consumer electronics as well as telephones, cars and household items. Earlier this year, Philips said it hoped to sell the division or merge it with another chip maker in order to focus on other businesses, spend more on R&D and leave the volatile chip business behind.

The semiconductor industry tends to go from boom to bust every few years in line with demand for PCs for other electronics products such as mobile phones and consumer electronics.

Three private equity firms are currently bidding for Philips’ chip unit, The Wall Street Journal says.

Philips, which is based in Amsterdam, reported 2005 revenue at its chip unit reached 4.62 billion euros compared to 4.49 billion a year earlier. It posted operating profits for the division in both years.

-Dan Nystedt, IDG News Service (Taipei Bureau)

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