Philips Electronics will purchase US based lighting manufacturer Genlyte for $2.7 billion in cash, with an expected closing in Q1 2008.

Genlyte owns Lightolier, a leading brand of lighting control products targeting the custom installation industry. "This offer creates outstanding value for our stockholders and enables our management and talented associates to continue our successful strategy," says Larry Powers, chairman, president and CEO of Genlyte in a press release.

"We view this merger as an exciting opportunity for everyone, and as a result the Board unanimously recommended the offer to our stockholders."

For the 12 months ending September 30, Genlyte had sales of around $1.7 billion, according to the AP. According to reports, it was Genlyte's customers—not necessarily its technology—that pushed the deal through.

Theo van Deursen, head of Philips' lighting division, said Genlyte's distribution channels were more important to Philips than its manufacturing technology. Philips has invested heavily in developing energy-saving bulbs, but has so far been more successful in Europe than in the United States in marketing them.

"It's very important that (Genlyte) are in contact...with the lighting designers and architects, which helps us a lot in bringing new products to the market," Van Deursen said on a conference call. Van Deursen said Philips hopes to sell new products, especially LEDs, to Genlyte customers.

All issued and outstanding Genlyte stock will be purchased for $95.50 per share no later than Dec. 4, the company said. In June, Royal Philips Electronics acquired Color Kinetics, a manufacturer of LED lighting.