Phillips completed it acquisition of Color Kinetics, Inc. on August 27, 2007.  From its opening $10.00 IPO price on June 22, 2004 until its last trade at $33.98 on August 23, 2007 IPO investors saw annual returns of 47%.  In our view this was a very advantageous sale for the shareholders and clearly represents a strategic purchase by Phillips.
Growth in ’06 had slowed to 24% from the ’05 growth rate of 32% and operating earnings were not material.  Adjusting for Color Kinetics, Inc’s significant cash holdings the purchase price was between 8.5 – 9.0 x the mid 2007 revenue rate. The other small companies in LED sector must have taken notice of this valuation level.