Ams Osram sells off Fluence to former rival Signify

For some time now, ams Osram has said it will emphasize chip-level activities rather than the broader illumination businesses that it picked up via ams' 2020 acquisition of Osram. Today, it backed up those words like never before, announcing it is selling its horticultural lighting unit, Fluence, to Osram's erstwhile lighting rival, Signify for $272 million.

Horticultural lighting is regarded by many lighting industry experts as an area with great growth potential. Growers are increasingly tapping LED systems tuned to optimal spectral wavelengths for different crops, sometimes combining them with sophisticated controls, in both greenhouses and vertical farms. The improvements in yields and quality are often impressive, benefiting not only the farming business but also the world's food supply.

Indeed, Fluence — or Fluence by Osram, as it is officially known — itself has been racking up wins. Founded in 2013 and acquired by Osram in 2018, the company had $141 million in sales in the twelve months from Oct. 2020 through Sept. 2021. If there were a lighting group that ams Osram might have spared in its ongoing sell-off of lighting operations, Fluence would have seemed like a good candidate.

But ams hinted to LEDs Magazine last month that even Fluence could go. At the time, the company had recently divested its Digital Lumens IoT lighting group, then the latest in a series of lighting sell-offs. We asked if any of the remaining units, such as Fluence, were safe. "As mentioned previously, there are elements of the…portfolio which are not core to the ams Osram business," a spokesperson told us early in the month, adding that, "if relevant, updates will be made accordingly."

Such an "update" came today, with Signify agreeing to buy Austin, TX-based Fluence for $272 million in cash on a debt-free basis. The companies expect the transaction to close in the first half of 2022, subject to regulatory approvals and other conditions.

A few years ago, when Signify and Osram were staunch rivals in the general lighting business, it might have been unthinkable that one would sell a lighting unit to the other.

But times have changed. With the July 2020 acquisition of Osram by Austrian sensor maker ams, ams Osram has been pulling out of various lighting businesses. In addition to Digital Lumens, its sell-offs over the last year have included the sale of its North American driver and light engine business to Acuity Brands in June, and the February sale of a Plovdiv, Bulgaria lighting components factory, among others.

Meanwhile, Signify has continued to build up different lighting operations, not the least of which has been horticultural lighting, most recently exemplified by an installation at a Dutch gerbera farm.

"Fluence and Signify are a strong match in complementary lighting expertise for the horticulture market," said ams Osram's Wilhelm Nehring, who is executive vice president of the company's Digital Business Unit — the group that has been home to the sold-off businesses.

In a flattering statement that one might have never seen in the not-too-distant past when Osram and Signify — previously called Philips Lighting — generally duked it out for business, ams Osram's Nehring added, "Signify is an industry leader with over a century of history bringing innovative lighting technology, products, and services to market."

Fluence was founded in 2013, and Osram acquired it in 2018. It has about 200 employees.

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Photo by GreenForce Staffing on Unsplash

Source: LEDs Magazine