General Lighting Company (GLC), the market leader in lighting in the Kingdom of Saudi Arabia (KSA), announced that it has entered into agreements to create a Joint venture with Philips Lighting, the global leader in lighting.
The joint venture will be a leading lighting player in the KSA, the largest economy in the Middle East by GDP. It will provide a full range of LED lighting solutions and strengthen GLC group’ market position, while creating growth opportunities in sustainable technologies to support the government’s objective to reduce energy consumption. It will also bring together GLC’s deep local market knowledge and strong commercial capabilities with Philips expertise in LED technology and the benefits of its global supply base. The KSA lighting market is forecast to grow substantially in the period 2014 – 2018, driven by targeted spending on construction, and government and private investments in energy efficient lighting initiatives.
GLC has a leading position in the KSA market, with a strong mix of projects, distribution and retail channels which puts it in an excellent position for the future to benefit from the very ambitious Saudi Arabia Economic Development plan. General Lighting Company’s capital is SR200,000,000 (Saudi Riyals two hundred million) and a Turnover of SR1,2bn in 2013.
“By partnering with Philips, GLC will benefit from “best in class” lighting innovations and from an extensive lighting know-how and services, which will rapidly strengthen GLC’s “energy efficient” Lighting propositions for the great benefit of the Saudi Arabia market,” said Abdullah Ibrahim Al-Hobayb, Chairman of GLC group.
“By partnering with GLC, Philips will be able to grow its business in this important market, particularly in relation to LED lighting. We expect LED penetration in the KSA to achieve strong double-digit growth by 2018, driven by investments in public and private infrastructure,” said Eric Rondolat, CEO of Philips Lighting. “As a global leader in energy efficient LED lighting products, systems and services we look forward to joining forces with GLC to provide innovative, meaningful and energy efficient solutions.”
Under the terms of the agreements Philips will acquire 51% of GLC, from a consortium of shareholders, for a total amount of $235m (on a cash-free, debt-free basis) plus additional transaction costs. Philips’ current Lighting activities in the KSA will be combined with GLC. Alliance is the holding company managed by Abdullah Al-Hobayb (founder and chairman of GLC) and will be the JV partner with a 49% stake. Closing of the proposed transaction is subject to customary regulatory approvals and other closing conditions and is expected to be within the 2nd quarter of this year.
The venture will focus on LED products, systems and services for the entire lighting market and will manufacture and distribute professional LED lighting fixtures throughout the entire value chain. The joint venture will employ approximately 1,300 people. It will help to stimulate economic growth in the region and support the ambition of the KSA to strengthen local manufacturing.
For further information, please contact:
GLC Marketing Group
Tel: +966 55 33 88 594
Santa van der Laarse
Philips Group Communications
Tel: +31 6 53400056
Philips Middle East Communications
Wednesday, March 26- 2014 @ 15:40 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.