GE to sell appliances business to China’s Haier for $5.4 billion

GE to sell appliances business to China’s Haier for $5.4 billion

Shares

GE has sold its Appliances business to China’s Haier for $5.4 billion.  GE was earlier talking to Sweden’s Electrolux (ELUXY), but the deal did not go through because of antitrust concerns from regulators.  US accounts for more than 10% of world’s appliances market.  The headquarters of the newly acquired division of Haier will still be in Louisville, Kentucky.

#GE to sell appliances business to China’s #Haier for $5.4 billion Click To Tweet

Just in 2016, Chinese companies have spent $12.3 billion buying foreign companies, as per Dealogic.

As Trump’s juggernaut keeps rolling and he keeps winning the Republican debates, the specter of his policies become important for foreign, specially Chinese, companies.  That is another reason why this deal assumes importance.

The antitrust regulators killed the Electrolux deal because they were trying to protect U.S. consumers from higher prices. Haier’s products are set to get 45% more expensive due to a new import tariff if Donald Trump has his way, so buying a big domestic manufacturer could keep it one step ahead of the GOP frontrunner. Trump’s tariffs are intended to punish China for devaluing the yuan – at a time when the Chinese government is struggling to slow the currency’s decline.

Meanwhile in China, there has been a major slowdown with markets in a tailspin!

Both China’s major stock indexes shed more than 3 percent, raising questions about Beijing’s ability to stop a sell-off that has now reached 18 percent since the beginning of the year.

Chinese shares extended their losses after data showed new yuan loans in December were well below the previous month’s lending, and broad M2 money supply growth also slowed, with both missing expectations.

China will publish a host of data on Monday and Tuesday, including fourth quarter gross domestic product.

So, to have the Chinese companies branching out in a record way in just 15 days of the new year is quite remarkable.

Also Read:  Fitbit data exposes lie of a woman's "staged" rape!

Shares
%d bloggers like this: