Philips completes acquisition of Agilent Technologies� Healthcare Solutions Group

Amsterdam, the Netherlands, August 1, 2001 - Royal Philips Electronics (AEX: PHI, NYSE: PHG) announced today that it has completed the acquisition of the Healthcare Solutions Group (HSG) of Agilent Technologies, Inc. (NYSE: A) for a total purchase price of EUR 2 billion. Philips has paid an amount of EUR 1.9 billion on August 1, 2001. Upon satisfaction of certain post-closing conditions an additional EUR 100 million will be paid.

Resulting from this acquisition there will be charges in 2001 estimated at approximately EUR 250 million. These charges are predominantly one-time charges and relate to the amortization of intangibles, in-process R&D, purchase accounting adjustments and adaptation to the Philips Accounting Principles.

Philips will apply the new accounting rules with respect to goodwill amortization (no goodwill amortization) as required under US GAAP for acquisitions made after July 1, 2001. This is in anticipation that these same rules will be applicable under Dutch accounting principles as well.

Announcement of the transaction was originally made in November 2000. HSG currently employs approximately 5,000 people and operates in over 100 countries worldwide and will be integrated in Philips Medical Systems.

Media inquiries:

Andre Manning, Philips Corporate Communications, Tel: +31 20 5977199

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