Dec. 10 (Bloomberg) -- Royal Philips Electronics NV investors Jana Partners LLC and D.E. Shaw Group, which own about 1.6 percent of the company, teamed up to review Philips's results and capital structure.

Jana Partners and D.E. Shaw plan ``to act together to jointly communicate their views, publicly or privately, regarding operating performance and capital structure'' of Philips, the New York-based firms said in a joint statement distributed by PR Newswire on Dec. 8.

Chief Executive Officer Gerard Kleisterlee sold most of the company's semiconductor assets and reduced the stake in a flat- panel display venture to focus on medical scanners, appliances and lighting. Amsterdam-based Philips will have as much as 20 billion euros ($29.3 billion) available for purchases, buybacks and dividends in the next three years.

``Hedge funds are targeting the enormous cash position,'' said Wing-Yen Choi, an analyst at Theodoor Gilissen in Amsterdam who recommends investors ``buy'' the stock. ``Philips wants time to build out its plan. But you'll see some shareholders are becoming impatient, especially because the shares didn't do much lately.''

Philips stock rose as much as 89 cents, or 3.1 percent, to 29.36 euros and traded at 29.32 euros as of 9:39 a.m. in Amsterdam. Before today, Philips shares had lost 0.4 percent this year, trailing the 3.7 percent increase of the benchmark Amsterdam Exchanges Index to which it belongs.

Talks With Shareholders

Jana and D.E. Shaw plan to enter talks with Philips, Dutch newspaper Het Financieele Dagblad reported earlier today.

Philips holds ``frequent'' talks with ``a great many'' of its shareholders, company spokesman Arent Jan Hesselink said by telephone today. He declined to say if Philips has had discussions with the funds.

On Sept. 10, Philips raised its profit forecast because of lower costs linked to the planned merger of its health-care units and of the consumer divisions. Earnings before interest, taxes and amortization will top 10 percent of sales by 2010, up from more than 7.5 percent this year, and operating earnings per share will more than double.

As of Jan. 1, Philips will merge the consumer electronics and domestic appliances and personal care businesses into a consumer lifestyle unit. A health-care unit will be created through the combination of Philips's consumer health-care solutions and medical systems divisions. Philips expects the overhaul to deliver as much as 200 million euros annually in cost savings.

To contact the reporters on this story: Jeroen Molenaar in Amsterdam jmolenaar1@bloomberg.net; Marcel van de Hoef in Amsterdam at mvandehoef@bloomberg.net

Last Updated: December 10, 2007 03:42 EST