The first company in my series of the top 25 stocks for the NEXT 25 years is about to be acquired. Color Kinetics (NASDAQ: CLRK) is being pursued by Dutch-based company Philips Lighting for $34 per share. The Dutch company is the world's largest lighting company.

The $34 per share offer represents a $688 million total acquisition price. Color Kinetics management has endorsed the deal and is encouraging shareholders to accept the offer.

Color Kinetics brings a rich portfolio of patents to the marriage. With 64 patents having been granted and another 100+ patents-pending, Color Kinetics brings to Philips the next generation technology of LED lighting products. Color Kinetics had won many high-profile lighting contracts recently, including the dash-board lighting work for Ford Motor Co. (NYSE: F). The new-generation LED-based lighting systems had not yet been economical for residential housing applications, but the market is indeed moving in that direction.

With Philips owning Color Kinetics technology, the residential market will be within its reach in the near future. Color Kinetics is selling to Philips for nearly 7 times revenues, a rich valuation, but certainly not when considering the growth rate of Color Kinetics, 35-40%, and its patent portfolio.

Oh well, we still have 24 companies left on the original list of 25 stocks for the NEXT 25 years...

Georges Yared is the CIO of Yared Investment Research.

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