$5.4 Billion Sale Follows Failed Deal With Electrolux
General Electric has announced the sale of its appliance division to the Chinese firm, Haier for 5.4 billion dollars. The sale includes GE's 48% share of Mabe, a Mexican based appliance firm. GE's previous attempt to sell its appliance operation to Swedish-based Electrolux Appliances was opposed by the U.S. antitrust authorities, and eventually terminated.
It's highly unlikely this sale will face such opposition, since Haier does not have a significant U.S. market share in large appliances such as full-sized washers, dryers, refrigerators, and ranges. This is good news for U.S. workers. While the sale to Electrolux was sure to bring some factory closings due to plant redundancies, Haier does not have the same large scale appliance manufacturing facilities in the U.S.
While GE had several very good options, this appears to be a very straightforward transaction, and GE got a nice increase in the sale price over the 3.3 billion dollars they would have received in the Electrolux deal.
There are many who would have preferred that GE Appliances would have remained U.S. owned, but there just aren't other US appliance firms that would be viable candidates. A spinoff might have been possible, but $5.4 billion must have seemed a lot better to GE.
Congratulations to GE Appliance management. They have a great team, and this deal should keep them fairly well intact, as well as thousands of factory workers.