China's Midea Group offers to buy German factory robot manufacturer Kuka for $5.07 bn
18 May 2016
Chinese home appliance maker Midea Group today tabled an unsolicited €4.5-billion ($5.07 billion) buyout bid for German factory robot manufacturer Kuka AG.
Midea, China's biggest maker of home appliances, has offered to pay €115 per share, a premium of 36 per cent to Kuka's Tuesday closing share price of €84.41.
The Guangdong province-based company is the second-largest shareholder in Kuka with an indirect 13.5 per cent stake. The largest shareholder is German privately held engineering company Voith Group with 25.1 per cent, and German billionaire Friedhelm Loh holds 10 per cent through his holding company.
"As a customer and investor, we have been impressed by Kuka's management andemployees and have had constructive dialogue since building our initial stake in thecompany," said Paul Fang, chairman and CEO of Midea.
Midea said that it plans to not delist Kuka and keep the company's management.
"Kuka is in excellent condition today and we are committed to investing in Kuka's employees, brand, intellectual property and facilities to further support the company's development," Midea chairman and CEO, Paul Fang said in a statement.
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.
Founded in 1968, Shenzhen-listed Midea owns some of China's top air-conditioner, refrigerator and washing machine brands.
It has more than 200 subsidiaries globally, employs around 100,000 people and has annual sales of over $21 billion.
Midea established its first overseas factory in 2007 near Ho Chi Minh City in Vietnam to manufacture rice cookers, air-conditioners and refrigerators.
The company has operations and production bases in Vietnam, Belarus, Egypt, Brazil, Argentina and India, and technology and partnerships with Carrier of the USA and Toshiba of Japan.
The company has recently been looking at overseas acquisitions in order to expand internationally.
In March, it agreed to acquire a controlling 80 per cent stake in Japanese conglomerate Toshiba Group's consumer-electronics arm for about $473 million.