STOCKHOLM — AB Electrolux has entered into an agreement to acquire the appliance business of General Electric (GE Appliances), the company reports, for a cash consideration of $3.3 billion.
The deal is structured primarily as an asset transaction, with completion subject to regulatory approvals. The acquisition is expected to close during 2015.
The acquisition also includes a 48.4% shareholding in the Mexican appliance company Mabe with which GE has had a joint venture with for nearly 30 years. Mabe develops and manufactures portions of GE Appliances’ product offering.
The move is “an important step” for Electrolux, with the fit between both companies creating a “strong platform for growth in the North American appliance market and [enabling] the combined businesses to better serve North American consumers.”
“This is an historic moment and important strategic move for the Electrolux Group, which takes our company to a new level in terms of global reach and market coverage,” says Keith McLoughlin, president and CEO of Electrolux. “GE’s premium, high-quality appliances complement our own iconic brands and will enhance our presence in North America. The acquisition, which is our largest ever, strengthens our commitment to the appliance business and also provides Electrolux with the scale and opportunity to accelerate our investments in innovation and global growth.”
Jeff Immelt, chairman and CEO of GE, says, “Electrolux is the right global business for our customers, consumers and employees. GE Appliances’ people, valuable home appliances brand, products, distribution, and service capabilities make it a perfect fit with Electrolux and its goal of accelerating growth in the U.S.”
“GE Appliances is a well-run operation with strong capabilities in key areas such as R&D, engineering, supply chain and customer service, and we look forward to joining forces with their team of talented and competent people,” adds McLoughlin.
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