Dutch electronics company Philips NV (PHG) Monday said it has agreed a license deal with Japan-based peer Funai Electric Co. (6839.OK) for its television activities in Mexico.

The deal was completed by the end of 2008 and took effect in March, a Philips spokesman told Dow Jones Newswires.

Philips didn't give financial details on the agreement. "It's a relative small deal", the spokesman said.

The agreement allows Funai to produce, distribute and market Philips-brand TVs in Mexico for at least five years. The deal follows an earlier agreement between the two companies on the sale of Philips' TVs in North America.

In return, Philips will receive royalties for the TVs sold by Funai.

In April, Philips' TV-division saw first-quarter sales drop by 33%, while the unit's earnings before interest, taxes and amortization, or Ebita, came in at a loss of EUR83 million.

Philips' TV-operations have been loss-making over the past years. To make them profitable again, the company last year announced several restructuring measures, including the disposal of some factories and job cuts.

By Harm Luttikhedde and Maarten van Tartwijk, Dow Jones Newswires; +31-20-5715200; maarten.vantartwijk@dowjones.com