Exor Buys 15% Shareholding in Philips
Medtech leader, Royal Philips, has announced the purchase of a 15% shareholding in the company, by Exor, the investment branch of the Italian Agnelli family. The purchase is viewed as a vote of confidence in the Dutch company following a massive product recall that began in mid-2021 and involved millions of ventilators and other respiratory devices. The transaction is valued at approximately €2.6 billion.
Philips, most famous for the production of light bulbs and electronic devices, has seen challenges to its transition to healthcare primarily due to the recall of its respirators.
The Agnelli family has been gradually diversifying its vast portfolio in recent years, beginning with the merger of the family’s Fiat Chrysler Automobiles group with France’s Peugeot to create Stellantis in 2021.
A statement issued by Exor said that the company aims to build great companies providing stable and committed support for their long-term value creation plans. The discussions between Exor and Philips were initiated in the context of Exor’s stated interest in increasing its presence in the healthcare and technology sectors. Exor’s investment in Philips will not result in any share dilution and has been carried out by way of on-market share purchases and an agreement with a major financial institution.
The relationship agreement includes Exor’s commitment to be a long-term minority investor and the right to propose one member to the Supervisory Board, as well as several customary conditions. While Exor does not plan to buy further Philips shares in the short term, over time the relationship agreement provides for Exor, at its discretion, to increase its participation to a maximum limit of 20% of Philips’ outstanding ordinary share capital.
Roy Jakobs, CEO of Royal Philips, said, ‘Exor’s investment in Philips, their long-term outlook and increased focus on healthcare and technology, fit well with our strategy and substantial value creation potential. With our market leadership positions and people-centric innovation capabilities, Philips is well positioned to deliver on our purpose to improve the health and well-being of people, creating value for all stakeholders.’
John Elkann, Exor’s CEO, commented, ‘The path of change taken by Philips in recent years has created a company that combines two areas – healthcare and technology – to which we are committed. Our discussions have confirmed the strong and positive alignment between our long-term, supportive approach to our companies and Philips’ ambitious plans under the chairmanship of Feike Sijbesma and the executive team led by Roy Jakobs.’