General Electric agreed to sell its appliances business to China's Qingdao Haier for $5.4 billion in cash, the companies said on Friday.
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The move comes weeks after GE abandoned a $3.3 billion deal with Sweden's Electrolux following months of opposition from U.S. antitrust regulators.
Haier will continue to use the GE Appliances brand and retain its headquarters in Louisville, Kentucky along with its current management team, the companies said.
The transaction includes GE Appliances' 48.4 percent stake in Mabe, a Mexican appliance company that has operated a joint venture and has had a sourcing relationship with GE Appliances for 28 years, Haier said.
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.
The transaction is also to be approved by shareholders of Qingdao Haier - KKR and Haier, who jointly own 50.8 percent of the company, the person said.
Haier Group owns a 41 percent stake in Qingdao Haier.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.
The deal, which will generate an after-tax gain of about 20 cents per share upon closing for GE, values the business at 10 times its earnings before interest, taxes, depreciation, and amortization (EBITDA) in the last 12 months, GE said.
GE expects to offset the gain with restructuring in 2016.
In 2014, GE Appliances had about $5.9 billion in revenue and $400 million in EBITDA. The company employs about 12,000 workers globally, 96 percent of whom are based in the United States.
(Reporting by Ankush Sharma in Bangalore; Editing by Gopakumar Warrier)