Published on May 11th, 2018 | by The GC Team0
Gorenje chooses Hisense as best bidder
Gorenje, Slovenia’s largest domestic appliances manufacturer, which has been seeking a strategic partner for some time, has announced that Chinese white goods and electronics group Hisense has been identified as the best bidder among the three Asian companies that had submitted binding offers.
In a statement, Gorenje said: “On 8 May 2018, Gorenje d.d. received 3 binding offers by the interested strategic partners from Asia, and on 9 May 2018, the two best bidders have been requested to improve their offers. The management board of Gorenje d.d. has assessed the received offers as well as the improved offers together with its financial and legal advisor and with the key shareholders who have been active in the process. The following criteria have been considered: the strategic elements, which were the basis for the initiation of the strategic partnership process; the feasibility of the transaction; and the price per share offered to the shareholders. Based on these criteria, Chinese group Hisense has been selected as the best bidder. Hisense has offered 12 euros per share subject to its acquisition of 50% + 1 share of Gorenje shares in the takeover procedure. The selected bidder has committed to launch a takeover intent within 15 days and to a takeover offer in accordance with the statutory deadlines.The process of the exploration of strategic partnership opportunities has thus been completed and Gorenje d.d. will no longer publish any updates on the process unless mandatory by law.”
Hisense is reported to be one of three Chinese companies to have submitted bids for Gorenje. The other two bidders were identified in local media reports as the Chinese home appliance maker Haier Group and Hefei Meiling Co Ltd.
Based on the number of existing shares in late March, the deal will exceed 146.5 million euros for the agreed acquisition of 50% plus one share. Gorenje’s shares gained 66%, up to 11.3 euros, on the Ljubljana Stock Exchange.
Gorenje, having reported a fall in net profit of 84% in 2017, “due to cost pressures and strong competition,” has been seeking a strategic partner “to increase cost efficiency and strengthen the brand.”
With the Chinese appliances marked reaching near saturation, domestic manufacturers are looking to overseas markets, including Europe, to fuel business growth, and acquisition is seen as the quickest route to access new markets.
Zhou Houjian, chairman of Hisense, is already on record as saying the company is targeting the middle and high-end sectors of the market, and that “Hisense is counting on overseas markets for future growth.”