On Wednesday, China’s home appliance maker Midea Group disclosed their takeover plan for German industrial robot maker Kuka AG, which the offering price from Midea Group announced to pay €115 a share, or about $130.20 that is 59.6% more than Kuka’s closing price of €72.05 a share before Midea’s announcement. This Midea’s takeover plan would become one of the largest unsolicited approaches of a foreign company by a Chinese buyer.
This decision confirms Midea’s previously stated intention to increase their shareholding in Kuka, which is curretly indirectly account for 13.5% of Kuka’s share. According to Midea, they are plan to increase their shares in Kuka to more than 30% without intention of concluding a domination agreement or delisting the company, which requires an offer for all issued shares in the Ausburg, Germany-based company.
Midea’s offer still waits for approvals from regulatory and antitrust authorities in Germany, and of Midea shareholders; and the detailed public takeover offer awaits approval of BaFin, Germany’s financial service regulator. Stated by State-owned China Securities Finance Corp Ltd and private-equity firm CDH Investments are among Midea’s minority shareholders. Kuka would still remain independent and listed in Germany, Midea added.
Midea Group Co, (000333 China: Shenzhen), headquartered in China’s Guangzhou province since 1968, which is China's biggest maker of home appliance also includes some of China’s top air-conditioner, refrigerator and washing machine brands. In this first quarter of this year, the net profit reported by Midea is 3.9 billion yuan ($598 million).
"As a customer and investor, we have been impressed by KUKA's management and employees and have had constructive dialogue since building our initial stake in the company," said Paul Fang, chairman and CEO of Midea.
Kuka, founded in 1898, is one of Germany’s leading companies focused on the digitization of industrial manufacturing processes. Kuka also has facilities in U.S., recorded €1 billion in revenue in North America last year and supplies clients including car maker Fiat Chrysler Automobiles NV and defense company Northrop Grumman Corp.
According to Midea, this takeover plan between Kuka and Midea fits for their “smart” strategy, which aims to improve their manufacturing competencies and develop their smart home devices.