Sweden’s Electrolux, on Monday, announced that it is buying the appliances business of General Electric (GE) for $3.3 billion (`19,872 crore) with a view to boost its presence in the North American market.
The acquisition is the largest ever for Stockholm-based Electrolux, ranked as the world’s second biggest home appliance maker after US-rival Whirlpool.
Electrolux CEO Keith McLoughlin said the move, which needs regulatory approval and is expected to be completed in 2015, “takes our company to a new level in terms of global reach and market coverage.”
“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 US,” GE chief executive Jeff Immelt said in a joint statement.
GE confirmed last month it was in talks to sell its appliances division — which made the first electric toaster more than 100 years ago — as part of its effort to focus on more complex and profitable industrial equipment.
Electrolux has more than 60,000 employees, including 10,000 in North America.
{{/usCountry}}Electrolux has more than 60,000 employees, including 10,000 in North America.
{{/usCountry}}The transaction is expected to generate annual cost savings of around $300 million.
GE Appliances division, which has 12,000 workers at nine factories, earned $381 million last year. On the other hand Electrolux posted a second-quarter net loss of $13.5 million but said demand in Europe and the US was picking up.