Although information about any possible personnel shifts were not immediately disclosed, Haier and GE Appliances have stated that GE Appliances’ local board and GE’s current senior management team will continue to guide the company.
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The Chinese appliance maker beat other overseas corporate bidders to acquire General Electric’s Louisville, Kentucky based appliance business, reports WSJ.
GE has been trying to sell the appliance business because it wants to focus on being an infrastructure and technology company.
GE was seeking another suitor for the unit after an agreement with Electrolux AB collapsed following opposition from the US Department of Justice. Electrolux vigorously contested this effort by the DOJ to oppose the transaction, but in vein, and had to pay a break-up fee of $175 million to GE after the termination of the deal.
GE said it was spending $1 billion to expand and modernize its Appliance Park, introducing lean manufacturing with an improved plant layout and ergonomics.
The deal is expected to provide GE Appliances access to the demand for its high-quality products in the China market. He said the two firms will explore opportunities for joint collaboration. “There will be no closures of facilities or loss of jobs because of this transaction”, it said.
“With Haier I think we really will have job security here”.
Haier has limited presence in the United States, hence the acquisition would act complementary to its existing range of products and operations, the person added.
As for renegotiating the labor contract, Crittenden said he did not think it would be an issue.
Hong Kong-listed Haier Electronics Group Co. was increasing capital spending past year as it seeks to capture a greater share of the country’s e-commerce sales and develop more Web-connected appliances users can control with their smartphones, Chairman Zhou Yun Jie has said in an interview.
Mayor Fischer, too, was upbeat about the news.
“Haier had always fancied themselves the GE of China so now they get the real thing”, Steven Winoker, an analyst at Sanford C. Bernstein & Co., said in a note.
Haier is one of the world’s largest home appliance manufacturers. It said the deal “establishes a model for cross-border investment and cooperation between China and the United States”.
“The business’ integration into Haier, combined with Haier and GE’s lasting, comprehensive partnership, lays a solid foundation for Haier’s long-term growth”.
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The Chinese owner of Fisher & Paykel Appliances has bought General Electric’s US-based appliance business for $US5.4 billion.
