Voith Group agrees to sell its 25.1% stake in Kuka to Midea for $1.34 bn
04 July 2016
Chinese home appliance maker Midea Group's unsolicited €4.5-billion ($5.07 billion) buyout bid for German factory robot manufacturer Kuka AG is likely to go through after German privately held engineering company Voith Group decided to sell its stake to the Chinese bidder.
Voith yesterday said that it would sell its 25.1-per cent stake in Kuka to Midea for about €1.2 billion ($1.34 billion).
In May, Midea, which holds an indirect 13.5 per cent stake in Kuka, offered to buy the robot manufacturer for €115 per share, a premium of 36 per cent to Kuka's 17 May closing share price of €84.4. (See: China's Midea Group offers to buy German factory robot manufacturer Kuka for $5.07 bn) http://www.domain-b.com/management/m_a/20160518_factory.html
But the German government has not been in favour of the deal since it did not want advanced technology to go to the Chinese and was looking at whether it could use a foreign trade law to block the deal or get a European suitor to counter bid for Kuka.
German economy minister Sigmar Gabriel unsuccessfully tried courting potential buyers like ABB Ltd, Siemens AG, and Robert Bosch GmbH.
Midea has eased German politician concerns by agreeing to not delist Kuka, retain the company's management, its headquarters in Germany, maintain factories and employees until 2023.
Voith said that that it would use the proceeds from the sale to invest in digital technologies, such as automation, IT security, sensors and robotics.
Voith, whose business spans oil & gas, energy, paper, raw materials to transport and automotive, had first acquired the stake in Kuka in December 2014 and said that its stake has more than doubled in value within about one and a half years.
Founded in 1898 by Johann Joseph Keller and Jakob Knappich in Augsburg with the aim to produce affordable illumination for houses and streets, Kuka is today one of the world's leading suppliers of robot technology and plant and systems engineering.
With manufacturing plants in Michigan and Ohio, Kuka is one of the leading suppliers of manufacturing systems for the automotive industry in North America.
China is its strongest growth market for automation. The headquarters for its Asian business is located in Shanghai, where it opened a new robot production facility in 2014.