Haier Electronics close to buying GE's appliances business for more than $4 bn
15 January 2016
China's Haier Electronics Group Co is close to finalising a deal to buy General Electric Co's (GE) appliances business for more than $4 billion, The Wall Street Journal today reported, citing people familiar with the matter.
Haier outbid other foreign bidders vying to buy GE's Louisville, Kentucky-based business, the WSJ said.
In December last year, GE called off its $3.3-billion deal to sell its appliances business to Sweden's Electrolux AB, after the US antitrust regulators opposed the deal. (See: GE calls off $3.3 bn appliances deal with Electrolux on regulatory fears)
The deal would have catapulted Electrolux as the world's biggest appliances maker, overtaking Whirlpool as it strengthens its position in North and South America
The US Justice Department had filed a lawsuit in July last year, seeking to halt the proposed acquisition saying that the deal would push up the price of appliances by 5 per cent since Electrolux, GE and Whirlpool hold more than 90 per cent of major kitchen appliances sold in the US to home-builders.
Haier already has sales and marketing unit and retail and services networks across North America. It also has a plant in South Carolina producing products including refrigerators.
In the US, GE's annual major appliance, whose brands include GE Monogram, GE Café, GE Profile, GE, GE Artistry and Hotpoint, has sales of approximately $3.4 billion.
Its last major overseas acquisition was in 2011 when it acquired a controlling stake in New Zealand's Fisher & Paykel Appliances Holdings for about $487 million.
Qingdao, Shandong Province-based Haier is the world's 4th largest white goods manufacturer with an annual turnover of $ 29.5 billion.
The Shanghai-listed appliance-making can count on state support from China's national banks for the acquisition as well as Western private equity players. It may have already spoken to China Development Bank for possible financing.