Electrical goods manufacturer Havells India will spend about 40 million euros (Rs 269 crore) on restrucurting Frankfurt-based Sylvania that it acquired in March 2007.

This would include retrenchment benefit to 1,300 employees of Sylvania who have been laid off during the integration of the company with Havells.

Havells India also announced the global launch of LED (light emitting diodes) bulbs. The company targets a revenue of Rs 100 crore by 2012 from the domestic market from the LED segment. The LEDs would be imported from the US under a tie-up with Cree. The company’s joint managing director Anil Gupta said Sylvania was expected to turn profitable in fiscal year 2010-11.

By the end of March 2010, Havells India would have spent 40 million euros on the restructuring of Sylvania, which includes reducing fixed costs, integration of the two companies and rationalisation of workers, Gupta said.

“We started restructuring of Sylvania in December 2008, when globally the markets came down reducing sales by 15 per cent. We will invest close to 40 million euros as a one-time investment. By March 2010, the integration would have been complete,” he added.

Havells India president Sunil Sikka said a large portion of the money was being spent on compensating retrenched workers in accordance with the European labour regulations.

Gupta said as part of the restructuring exercise, the company’s total employee strength has been reduced to 2,500 against the earlier 3,800. Earlier this year, the company announced shutdown of compact fluorescent lamps (CFLs) manufacturing plant at Shipley in the UK. The plant, acquired as part of Sylvania deal, employed around 250 people. The entire production of CFLs has been shifted to Neemrana in Rajasthan.