Philips and Arima Devices, an affiliated company of Arima Computer Corp. announced today they signed a share purchase agreement to transfer Philips' optical pick-up (OPU) business unit to Arima Devices.

According to the Philips' press release, the Dutch giant will take an approximate 14% share in Arima Devices at the completion of the deal. The OPU business unit produces optical pick up units for DVD recorders and PC DVD drives and is part of Philips Optical Storage. No financial details were disclosed.

The market for optical pick-up units for DVD recorders and PC DVD drives is maturing and economies of scale are needed to remain competitive. Through the transfer to Arima Devices, the OPU business unit will benefit from economies of scale. Arima Devices will benefit from acquired Philips' technology and expertise in DVD recording and Blu-ray Disc, which includes all patents generated by the OPU business unit.

The OPU business unit employs approximately 740 people in Asia and 40 people in Europe. These employees will be transferred to Arima Devices upon completion of the deal, which is expected to close in Q1 2006.