As Entekhab Struggles to Find Financing, Electrolux Still Interested in Daewoo
Feb 22, 2011
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Swedish appliance maker Electrolux, which appeared to have lost in its bid to buy Daewoo Electronics Corp. almost a year ago, may still have a chance to get its hands on the South Korean appliance company.
Daewoo owners in South Korea chose an offer from Iranian appliance maker Entekhab Industrial Group over the Electrolux offer. Media reports in November 2010 said Daewoo had been sold to Entekhab, although apparently payment was not made in November. Personnel from Entekhab Industrial Group, said in mid-November that they had begun the process of bringing Daewoo into the Entekhab corporate structure. The acquisition of Daewoo essentially transformed Entekhab into one of the world's biggest appliance makers. Various media reports put a $420 million to $520 million price tag on the transaction.
But Korea's Yonhap News indicated that Entekhab did not have the financing in place for the purchase and, with Iranian and international investors "showing little interest," couldn't arrange financing by an early February 2011 deadline. The news agency said creditors extended the deadline for two months, until April 7.
Electrolux CEO Keith McLoughlin recently told Bloomberg that Electrolux is still interested in buying Daewoo if Entekhab can't arrange the financing.
McLoughlin also told Bloomberg that it's plan to purchase Egypt-based appliance maker Olympic Group has been on-hold during several months of political unrest, but also said it was Electrolux's intention to proceed once an orderly transition of government has occurred.
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