Philips quits mobile phone business

Reuben Lee | Oct 13, 2006

Electronics giant Philips has announced it will be selling its mobile phones manufacturing operations to China Electronics Corp (CEC). According to various news reports, CEC will take over Philips' cellular handset business and gain a license to market and sell mobile phones under the Philips brand for the next five years. However, this will be subject to due diligence, government and regulatory approval which could take till the year end. No further details were released.

The Dutch company's mobile business reportedly generates an annual turnover of about 400 million euros (US$502.22 million). Its 240-plus employees are located mainly in Asia Pacific and Eastern Europe. Philips, however, has been observed to be winding down its mobile phones operations in the past few years. It will, instead, turn its focus towards its healthcare and lifestyle products, according to CEO Gerard Kleisterlee.

Observers see the latest move from Philips similar to what Siemens did a year ago when it sold its mobile phone business to BenQ. The Taiwanese maker has since last month terminated its handset operations in Germany, citing huge operating losses as the main reason.

Filed under: Mobile Phones
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