Haier, which made an abortive attempt in 2008 to buy the business, has a negligible presence in the US white goods market, dominated by Whirlpool Corp (WHR.N), Sweden’s Electrolux AB (ELUXb.ST) and GE.
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Qingdao Haier – a unit of Haier Group, which owns 41% of it – will acquire GE’s appliances business. “The amount of employees, the brands – we do not have that situation with Haier”, Freeman said, adding that GE did not expect to encounter any antitrust concerns over the deal.
The appointment of new Chief Executive Jonas Samuelson, who replaces Mr. McLoughlin at Electrolux from next month, could help the company focus on profitability, said Johan Eliason, analyst at Kepler Cheuvreux.
As part of the deal, Haier gets to keep using the GE Appliances name, something GE hopes will grow the overall brand in China.
The Haier Group outbid other foreign corporate bidders for the Louisville, Kentucky-based operation.
Haier has been looking to gain more market share in the Americas.
As of Q3 2015, the Appliance and Lighting segment, which includes the fast growing LED business, posted revenues of just $2.3 billion, only 8.7% of total industrial revenues.
According to Crittenden, the acquisition by Haier would be better for the local campus than an acquisition by a company such as Electrolux, which has significant presence in the USA and would have kept its North American headquarters in Charlotte, N.C.
GE said it was spending $1 billion to expand and modernize its Appliance Park, introducing lean manufacturing with an improved plant layout and ergonomics.
Today, the firm controls more than 10 percent of the global household appliance market, and raked in $32.6 billion in 2014 revenue.
“Even if Haier doesn’t have a history of dumping prices in the United States, as for example LG (066570.KS) and Samsung (005930.KS) has, this is still an unknown player, a Chinese player”, DNB Bank ASA analyst Christer Magnergard wrote in a broker note.
The deal, so far the biggest by Haier Group, will be subject to “customary regulatory filings in China and antitrust approvals in the United States, Mexico and Argentina”, said a person authorized to speak on behalf of Qingdao Haier.
“GE Appliances provides Haier with great products, state-of-the-art manufacturing facilities and a talented team”, Immelt continued. But Haier eventually backed out due to weakening USA market conditions and difficulty in securing financing.
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China’s Haier, the world’s largest appliance maker, will build on a legacy of disruption to create more web-enabled products and boost overseas sales, according to Chairman and CEO Zhang Ruimin. Therefore, the deal, if completed, will be beneficial for both companies.
