Philips Sells NXP Stake to U.K. Pension Fund

7 09 2010

London— On Tuesday, Royal Phillips Electronics said that it will sell its entire NXP equity stake to UK pension funds. Phillips proclaimed that it will make a contribution of 350 million Euros in cash that are 448 millions in dollars, to its UK pension fund.

This contribution of Phillips is a funding transaction; so it has no impact on Phillips earnings, Phillips said on Tuesday. This contribution will be used by the Trustees of the Phillips UK pension fund to purchase from Phillips its entire equity stake in NXP. In the meantime the sale of NXP shares will produce a gain of 140 million Euros that Philips will report in the third quarter.

A Philips spokesman refused on Tuesday to elaborate on the size of the deficit. He said the company would present an inclusive update on its pension funds in December.

In a research note, SNS Securities analysts said, “The one-off contribution to the UK pension fund is somewhat higher than we had penciled in.”

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