China’s Haier buying GE appliance unit for $5.4B
Jan. 15, 2016 - Haier Group, a global home appliance maker, is buying General Electric Co.’s appliance business for $5.4 billion to expand its U.S. and global presence. The two companies has agreed to form a strategic partnership to co-operate in areas such as the Internet, healthcare, and advanced manufacturing.
Today’s announcement comes as Haier tries to transform itself into a premium brand. GE is shifting emphasis from traditional businesses such as appliances, in which it has been a prominent presence for more than a century, to higher-technology areas such as medical equipment and clean energy.
The purchase is the third in a string of multibillion-dollar foreign acquisitions this week by Chinese buyers. On Monday, a state-owned chemical company announced the purchase of a German manufacturer, while on Tuesday, conglomerate Wanda Group said it was buying Hollywood’s Legendary Entertainment.
Haier, headquartered in the eastern Chinese city of Qingdao, makes a range of refrigerators, washing machines and other home appliances. It operates a string of 21 industrial parks worldwide.
Its purchase of GE Appliances is the biggest global corporate acquisition so far this year and the third-biggest in the United States by a Chinese buyer to date, according to Dealogic.
“This strategic alliance provides a new starting point for both Haier and GE and I am confident that this partnership will deliver enhanced value to the stakeholders of both companies,” Haier Group chairman Zhang Ruimin said in a statement.
Haier’s takeover of GE Appliances is the second-biggest purchase in the household appliance sector on record, behind Panasonic Corp.’s 2008 purchase of 50 per cent of Sanyo Electric Co. for $7.1 billion, according to Dealogic. It said Haier’s six foreign acquisitions to date total $6.3 billion.
“Haier has a stated focus to grow in the U.S., build their manufacturing presence here and to invest further in the business,” GE chief executive Jeff Immelt said in the joint statement. “In addition, we see the opportunity to work together to build the GE
brand in China.”
— With files from Joe McDonald, The Associated Press
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