May 27, 2015 / 9:52 AM / 4 years ago

Go Scale to fund Philips lighting components buy with $1.93 billion in debt

AMSTERDAM (Reuters) - Go Scale, the investment fund that is purchasing Philips’ lighting components unit Lumileds, said on Wednesday it would fund the acquisition in part by raising $1.93 billion (1.77 billion euros) in debt.

The fund said in a statement that the Bank of China was acting as sole bookrunner in arranging the debt financing, which will have both euro and dollar denominated tranches.

A Philips spokesman confirmed the details of the financing plan released by Go Scale, which agreed in March to buy an 80.1 percent stake in the unit at a $3.3 billion valuation.

Philips spokesman Steve Klink reiterated that Philips expected to receive $2.8 billion for its stake, with the deal closing sometime in the third quarter.

Go Scale said the financing with Bank of China included a revolving credit facility that will allow to company to “focus on investments and growth”.

Philips is selling the lighting components unit, which is the largest manufacturer of LED lights, ahead of splitting its own lighting and healthcare operations next year.

Go Scale said it expected the Lumileds business to “achieve transformational growth in the LED lighting unit in China” after it has been split off from Philips, which will remain a major customer.

Asia Pacific Resource Development, Nanchang Industrial Group, GSR Capital and Oak Investment Partners are investors in Go Scale.

Reporting by Toby Sterling Editing by Anthony Deutsch; Editing by Alison Williams

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