Amsterdam,
The Netherlands - Today Royal Philips Electronics (NYSE: PHG, AEX: PHI)
of The Netherlands and NEC Corporation of Japan (NYSE:NIPNY) announced
that they have signed a binding Memorandum of Understanding (MoU) to
form a joint venture in enterprise communications, by NEC taking a
majority share in Philips' Business Communications unit (PBC). The new
company will be named "NEC Philips Unified Solutions". Upon completion
of the transaction, NEC will hold 60% and Philips 40% of shares.
By combining NEC's strong technology base and market position in Japan
and North America, with Philips' strong market presence in Europe, NEC
Philips Unified Solutions will be able to strengthen its position in
Europe in view of the fast technology changes in the modern telecom
world.
The agreement involves all Philips Business
Communications' activities and businesses in EMEA (Europe, Middle-East
and Africa), with a total workforce of approximately 900 people.
Philips and NEC have been cooperating closely since 2003 in a strategic
partnership to jointly develop and deploy IP technology in enterprise
communications. Since then both parties have leveraged their expertise
to successfully address new opportunities in the IP communications
market, further developing customer base and channels to market.
Kazuo Tsuzuki, Associate Senior Vice President of NEC's Enterprise
Solutions Operations stated: "This joint venture will strengthen NEC's
global position in the telecom market and we are expecting to grow
sales of UNIVERGE solutions to the global customers on top of the
continued sales of the Philips portfolio. It will support NEC's growth
ambition by using the strong market position of PBC in the European
enterprise communications market. "
Commenting on the
agreement, Harrie Brunklaus, CEO of Philips Corporate Investments said:
"The combined strengths of NEC and Philips will offer NEC Philips
Unified Solutions unique opportunities in developing a powerful
portfolio of solutions and services, extending market reach and share
of the business communications market in Europe".
The
transaction will be conditional upon regulatory approvals and is
expected to be completed in the second quarter of CY 2006.
News Source: NEC Press Release
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