Consumer electricals company Havells India has decided to offload majority stakes (80 per cent) in Havells Sylvania Malta BV and Havells Exim to China’s Shanghai Feilo Acoustics for about €148.8 million, or about ₹1,070 crore.

For Havells Sylvania, its wholly-owned subsidiary, Havells Holdings Ltd, will enter into a definitive agreement with the Chinese company. The deals will be subject to shareholder and other regulatory approvals.

This transaction is expected to be concluded by February 2016.

Tech upgrade Anil Rai Gupta, Chairman and Managing Director, Havells India, said the proposed combination with Feilo will bring much required technology and scale to Sylvania.

The company will divest its remaining 20 per cent stake in Havells Sylvania Malta in the next five years, while the balance stake in Havells Exim is likely to be divested by February 2016.

“The combined equity value for 100 per cent stake for both companies is €186 million (₹1,340 crore), subject to adjustments, if any,” the company said. It added that Havells’ cumulative investment value stands at ₹980 crore.

Havells also said that it will continue to own 100 per cent stake in Havells Sylvania’s subsidiaries in the US, Brazil, Chile and Thailand, with exit options in the next three-five years.

“We are convinced that the current alliance with Feilo has the requisite attributes to gain immensely from emerging trends in disruptive lighting industry,” he added.

Gupta said this will also open up new opportunities for Havells for expansion through deployment of this capital. He said that the company will continue to look at expansion both organically and inorganically.

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