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Philips to Cut 225 Jobs at Lighting Site in Belgium (Update2)

By John Martens and Marcel van de Hoef

April 20 (Bloomberg) -- Royal Philips Electronics NV, the world’s biggest maker of light bulbs, said it plans to eliminate an additional 225 jobs at a lighting unit plant in Belgium.

The new round of restructuring at the site in the northern city of Turnhout comes on top of 264 job cuts announced in December, spokesman Arent Jan Hesselink said by telephone today. After the cuts, the workforce at the plant will be 1,600 people, the Belgian ACV union said in an e-mailed statement today.

Philips said on April 14 it will step up restructuring efforts this quarter, particularly in the lighting business, after experiencing a “significant further deterioration” of its markets. Annual cost savings for the Amsterdam-based company as a whole will exceed 500 million euros ($649 million) this year, it said at the time.

“The economy and markets relevant to this facility have further deteriorated” since announcing the job cuts in December, Hesselink said. “That’s why we have to take further steps to adjust this facility.”

Restructuring and acquisition-linked charges at the lighting unit will amount to about 90 million euros this quarter, Philips has said. The lighting business, also the world’s largest producer of light-emitting diodes, is suffering as the economic decline hurts demand in the automotive and building markets. First-quarter sales at the lighting division fell 15 percent to 1.5 billion euros.

Philips fell 48 cents, or 3.7 percent, to 12.58 euros, less than the 4.1 percent decline of the benchmark Amsterdam Exchanges Index.

To contact the reporters on this story: John Martens at jmartens1@bloomberg.net; Marcel van de Hoef in Amsterdam at mvandehoef@bloomberg.net

Last Updated: April 20, 2009 11:43 EDT