Exclusive: Electrolux near $2.5 billion-plus deal to buy GE unit: sources
By Soyoung Kim and Sven Nordenstam
NEW YORK/STOCKHOLM (Reuters) - Sweden's Electrolux AB is near a deal to buy General Electric Co's iconic appliance business for more than $2.5 billion, in a move that would significantly expand its reach in North America, people familiar with the matter said.
The companies are hammering out final terms of a deal and could announce their agreement as soon as next week, the people said on Thursday, asking not to be named because the matter is not public.
Shares of Electrolux jumped on news of a possible deal, rising 4.73 percent to 190.40 Swedish crowns and giving it a market capitalization of more than $8 billion.
Discussions are ongoing and could still take longer to finalize, the people cautioned. Representatives for GE and Electrolux declined to comment.
GE's century-old household appliance business, which along with lighting generated $8.3 billion in 2013 revenue, could help the Swedish appliance manufacturer expand beyond its core European market where growth has trailed that in North America.
Electrolux, which sells under brands such as Frigidaire, AEG and Zanussi as well as its own name, is already the world's second-largest home appliance maker after Whirlpool Corp.
GE had confirmed in August that it was evaluating strategic options for the home appliance business, including discussions with Electrolux and other interested parties.
With a price tag of more than $2.5 billion, Electrolux appears to be paying top dollar to win the asset. The GE business, which sells products under the GE Monogram, GE Cafe and Hotpoint brands, could be worth between $2 billion and $2.5 billion, people familiar with the matter have previously said. Continued...