Osram initiates sale of its luminaires business

(Germany) – As Osram looks to increase focus on growth markets in high-tech fields, it is to divest its luminaires business.

The management board of Osram has announced its decision to divest its luminaires business.

As part of the manufacturer’s strategic realignment, Osram is refining its positioning with an increased focus on the growth markets in high-tech fields.

“Thanks to numerous measures, the earnings position of the Lighting Solutions business unit has stabilised significantly, therefore allowing us to initiate an organised sales process,” said Osram CEO Olaf Berlien. “This will result in a more strategic focus with regards to applications with high growth potential.”

The company says that talks will be held with interested parties for the luminaires business, and the management board will provide an update on the progress of strategic plans for the company at the Capital Markets Day in November.

The move comes after the company saw a slump in its semiconductor segments Opto Semiconductors (OS) and in the Specialty Lighting (SP) segment in the third quarter of the fiscal year – brought on by the general economic slowdown and weak demand in the automotive industry, the company said.

Osram also cited the trade tariffs in the USA, more stringent emission tests in Europe and lower production expectations from premium manufacturers that caused more uncertainty, alongside project delays in business with mobile devices and horticulture applications, and a continued slowdown of the general lighting market.

Alongside selling its luminaires business, Osram management is looking at measures to rectify the current market situation, including streamlining the global administration, and the implementation of several structural and operational programs. The company will also look to improve the efficiency in R&D, in the supply chain, and in the German factory allowance, and is expecting that these operational programs should add up to €140million in savings by 2020.