Royal Philips Electronics announced today that they have signed a definitive merger agreement with Lifeline Systems, under which Philips will acquire Lifeline, a leader in personal emergency response services for the elderly.
Philips has agreed to acquire Lifeline for $47.75 per share, or $750 million, in a transaction that has been unanimously approved by the board of directors of Lifeline.
“The acquisition of Lifeline is an important step on our roadmap for growth in healthcare,” says Gerard Kleisterlee, President and CEO of Royal Philips Electronics. “By targeting seniors and other people who want to continue living independently and exerting more control over their health and lifestyle, we aim to become a global player in the evolving home healthcare market.”
According to Philips, the ageing of the population provides strong underlying market growth for home healthcare solutions such as those offered by Lifeline.
Today, elderly people represent around 15% of the population in the developed world and are expected to almost double in size over the next 25 years. At the same time they are becoming increasingly active in managing their own health and wellness.
Personal response services are already the largest category of home healthcare solutions purchased out-of-pocket by older adults and their caregivers. Penetration in the age group 65 years and older is 2-3%, allowing for significant future growth.