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Philips Accelerates Cost-Cutting Plans

November 03, 1998|Times Wire Services

Royal Philips Electronics said falling prices for television tubes and other components are prompting it to accelerate its cost-cutting efforts. The Dutch company has shut 25 factories since Jan. 1 and 18 more are earmarked for closure by year-end. "By the end of this year, we will have gone from 269 plants to 226," spokesman Ben Geerts said. "In 2002, we want to have between 160 and 170" plants. The company has cut loose German electronics maker Grundig, music company PolyGram and other businesses that Chief Executive Cor Boonstra called "bleeders." Philips' phone-making venture with Lucent Technologies Inc. also was not profitable, and the firm still faces other problems, including reviving its phone handset business after ending the Lucent partnership. The company said it is now seeking to expand through acquisitions in businesses such as medical products, semiconductors and lighting, according to a report in the Financial Times.

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