Dutch Philips Electronics said it has entered into a deal to outsource its PC monitors business to TPV Technology to boost profitability at its loss-making TV unit.
Philips said in a statement on Tuesday Hong Kong-listed PC monitor maker TPV will make and market all its IT Displays activities worldwide under a brand licensing deal, adding to a deal announced in April to transfer its North American television business to Japan’s Funai Electric.
The Amsterdam-based company, whose TV operations have been loss making due to tough competition from rivals such as Taiwanese Amtran’s Vizio brand, said it would take charges of about €66 million ($103 million) in the Q2 of 2008 relating to its TV business. In April, it said it would take charges of €125 million this year due to the Funai deal.
Philips reported a bigger-than-expected 28% drop in Q1 core profit in April as its television business sank deeper into the red, and said last week it wanted to cut hundreds of jobs due to weak markets and to improve competitiveness. (Reuters)