Koninklijke Philips's credit metrics have been below the level we consider commensurate with the current rating and are unlikely to recover in the near term given its ongoing restructuring expenses, costs for the split-off of the lighting business, and operations in competitive markets. We believe the split-off of its lighting business into a separate legal structure, which Philips is currently undertaking, will reduce business diversity, while the financial implications are still unknown. We are lowering our long-term rating on Philips to 'BBB+' from 'A-' and affirming the 'A-2' short-term rating. The stable outlook reflects our expectation that the rating will remain unchanged following the execution of the lighting split-off. On July 28, 2015, Standard&Poor's Ratings Services lowered its
