Exor NV, a Netherlands-based diversified holding company behind luxury names like Ferrari and Christian Louboutin, has bought a 15% stake in Royal Philips, with an option to increase it to 20%.
Exor’s investment, which grows its healthcare technology portfolio, fully supports Philips’ leadership, strategy, and value creation potential, according to a joint release from the companies, and provides for Exor to nominate one member to the supervisory board of Philips.
“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,” says John Elkann, Exor’s CEO, in a release. “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.”
Philips’ strategy and value creation plan with sustainable impact is based on its purpose to improve people’s health and well-being through meaningful innovation, according to the release, which notes the company has leading market positions in attractive health technology market segments enabled by an innovative portfolio and strong customer base.
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, says in a release, “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.”
Feike Sijbesma, chairman of the supervisory board of Royal Philips, adds in the release, “We welcome Exor as a long-term investor in Philips. They have a successful track record and clear strategy to grow and develop in healthcare and technology. Exor’s substantial investment underlines their confidence in Philips’ transformation into a healthcare technology company and its growth and value potential.”