Europe's biggest consumer electronics group, Philips, said on Thursday it stood to make a book gain of up to 750 million euros ($965 million) from the sale of its stake in digital mapping firm NAVTEQ. "We will use it for general purposes, to fund our growth," a company spokesman said when asked whether the group might consider a share buy-back. Philips shares were up 1.75 percent at 19.77 euros at 0744 GMT after the news. Philips said on Thursday it was selling 30 million shares in digital map and vehicle navigation company NAVTEQ for about 870 million euros and would make a non-taxable book gain of 680 million euros in the second quarter of 2005.
Philips will then have a 3.5 percent stake in NAVTEQ but underwriters of NAVTEQ's secondary offering have a 30-day option to acquire those shares as well.
If they do, Philips will have an additional 90 million euros in proceeds and make another 70 million euro gain.
NAVTEQ said on Thursday its offering was priced at $37.50 per share, down from the market price of $44.37 on March 29 when Philips announced its intention to sell.
NAVTEQ shares were listed on the New York Stock Exchange last year in the third-biggest technology offering in 2004 behind search engine Google and chip company Freescale.
In recent months, Philips has accelerated the sale of investments in unconsolidated companies as it aims to free up money to invest in medical systems, which have become the new growth engine of the company.
Philips is also the number three microchip producer in Europe, the region's leading consumer electronics firm and the world's biggest lighting maker.
It has sold stakes in French IT services provider Atos Orgin, Dutch chip equipment maker ASML and French media-to-telecoms group Vivendi Universal.
Philips's stake in Navteq had already fallen from 84 percent as a result of the initial public offering last year.
NAVTEQ is one of the world's top digital geographic map providers, generating sales of $393 million and net income of $54 million in 2004.
It competes with Netherlands-based and Germany-listed Tele Atlas on a global basis and local rivals in individual countries. Its maps are used in car navigation systems and Internet-based route-finders.
Dutch navigational software company TomTom last month announced its intention to list on Euronext, with analysts putting a price tag of over 500 million euros on the firm.
TomTom also uses maps made by Automotive Navigation Data.
Merrill Lynch, Pierce, Fenner & Smith Inc, Deutsche Bank Securities Inc, Lehman Brothers Inc and UBS Securities LLC are serving as the joint book-running managers for the offering.
William Blair & Company LLC, Credit Suisse First Boston LLC, Morgan Stanley & Co Inc and Piper Jaffray & Co are co-managers.
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