Electronics Production |
Philips, Toppoly to merge MDS business
Philips and Toppoly Optoelectronics Corporation of Taiwan have signed a binding letter of intent to join forces by merging Philips' Mobile Display Systems (MDS) business unit with Toppoly to create a new company in mobile display technology.
The company will be named "TPO". Upon completion of the transaction, TPO's principal shareholders will be Compal Electronics Inc. (of Taiwan): 25.1%, Philips: 17.5%, and UniPresident Enterprises Corp. (of Taiwan) with 3.5%.
As a result of this transaction Philips will take a charge of approximately EUR 70 million in fourth quarter 2005, based on current exchange rates and Toppoly share price. Additionally, in accordance with accounting principles, Philips will deconsolidate the MDS business and separately report the results in the 2005 financial statements.
The transaction, pending regulatory approvals, is expected to be completed in the first half of 2006. The participation in TPO will be reported as a non-current financial asset.
