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Royal Philips Electronics has reached an agreement to acquire India-based Meditronics, a leading manufacturer of General X-Ray systems targeting the economy segment in India. Upon closing of this transaction in the fourth quarter of 2008, which is subject to certain contractual and other conditions such as regulatory approvals, Meditronics will become part of the Imaging Systems business within Philips' Healthcare sector. Financial details of this agreement were not disclosed.

This marks Philips' growing presence in high-growth healthcare markets in emerging economies, and follows the earlier acquisitions of healthcare companies Alpha X-Ray Technologies in India, Chinese Shenzhen Goldway Industrial and Dixtal Biomedica e Tecnologia and VMI Sistemas Medicos in Brazil.

In commenting on the deal, Philips Chief Executive Officer Gerard Kleisterlee said: "The acquisition of Meditronics, just two months after we announced the acquisition of Alpha, highlights our accelerating efforts to expand our healthcare business in emerging markets and India in particular. This underlines our conscious decision to step up investments in these high-growth areas while also delivering on our commitment to supply affordable healthcare solutions in emerging markets."

Meditronics' high-quality proven economy segment product portfolio complements Philips' existing high-end General X-Ray range and further strengthens Philips' leading position in India's high-growth imaging and monitoring equipment market. Analysts estimate that the General X-Ray segment of the Indian market will show annual growth rates of 10% or higher. Philips will invest to expand sales in the local Indian market and will leverage its global distribution network to expand its offering of economy X-ray products in other emerging and, importantly, mature markets.

This is Philips' second acquisition within the last three months of a healthcare equipment maker in India specialized in supplying products for the economy segment - one of the fastest growing market segments in the global healthcare equipment market. Philips announced in early September the acquisition of Alpha, a leading manufacturer of Cardiovascular X-Ray systems. Analysts estimate the economy segment of the global Cardiovascular X-Ray market shows annual growth rates of 10% to 15%.

"Executing on our strategic decision to scale up our presence in emerging markets has been an important element of Philips' transformation into a focused, less-cyclical company in recent years," said Mr. Kleisterlee. "We are committed to continue this course of action by increasingly redirecting resources to help fuel growth in emerging markets, and build out our industrial footprint in this cost-effective and high-quality manufacturing environment - for Healthcare, but also for our Consumer Lifestyle and Lighting sectors."

Under the stewardship of Mr. Kleisterlee, Philips has transformed in recent years into a much simpler and more focused company dedicated to leveraging its deep consumer insight, technological prowess and innovative strength to deliver uniquely differentiating propositions to businesses and consumers. Philips' focus on becoming the leading brand in Health and Well-being is perfectly aligned with important demographic and economic trends, while also tapping into the people's increasing demand for advanced but easy-to-use products and solutions that improve the quality of their lives.