Philips to split into separate health and lighting companies

Philips has announced a major change to its business structure that will see it separate into two distinct organisations.

The first of these will be the HealthTech company, which will encompass the conglomerate's current healthcare and consumer lifestyle divisions, capitalising on the convergence of professional healthcare and consumer end markets.

It will occupy market-leading positions in a number of sectors, including oral healthcare, healthcare informatics, ultrasound diagnostics, cardiac care and home healthcare, serving a total addressable market estimated to exceed 100 billion euros (77.93 billion pounds).

Meanwhile, the second organisation will be its Lighting business, which make the transition to a separate and distinct legal structure, with management to consider various options for alternative ownership structures with direct access to capital markets.

Frans van Houten, chief executive officer of Philips, said: "Philips is uniquely positioned to help reshape and optimise population health management by leveraging big data and delivering care across the health continuum, from healthy living and prevention to diagnosis, minimally invasive treatment, recovery and home care."

Philips generated sales of 5.3 billion euros in the second quarter of 2014. Based in the Netherlands, it has been in business for more than 120 years.