Home appliances maker Whirlpool Corp said on Tuesday it would divest major parts of its Europe, Middle East and Africa (EMEA) business and form a new Europe-focused entity with Turkish household appliances manufacturer Arcelik.
Whirlpool will own 25% of this new entity, while Arcelik will have the rest.
Under the terms of the agreement, Whirlpool will contribute its European major domestic appliance business, and Arcelik will contribute its major domestic appliance, consumer electronics, air conditioning, and small domestic appliance businesses into the newly formed entity of which Whirlpool will own 25% and Arcelik 75%(1).
Separately, Whirlpool agreed in principle to the sale of Whirlpool’s Middle East and Africa business to Arcelik(1). Whirlpool will retain ownership of its EMEA KitchenAid small domestic appliance business.
The new entity is expected to have combined sales of over €6 billion(1) and will be well-positioned to deliver value to consumers through attractive brands, sustainable manufacturing, product innovation, and consumer services. The combined businesses are expected to generate cost synergies of over €200 million.
“Today’s announcement marks yet another major and important milestone in our ongoing portfolio transformation,” said Marc Bitzer, chairman and chief executive officer of Whirlpool Corporation.
“This allows us to participate in significant value creation from the repositioning of the business and cost synergies through our minority interest.”
The transaction is expected to close in the second half of 2023.
