|Rina S. |||May 19, 2016 11:30 AM EDT|
(Photo : Getty Images/Sean Gallup) Midea has made a $5 billion offer for Kuka
China's leading home appliance manufacturing company Midea has disclosed its bid for German robot-making firm Kuka. The Chinese company has offered a proposal of $130 per share for a controlling stake in the robotics company. The bid values the German company at more than $5 billion.
Midea is currently the second largest shareholder in Kuka. The company has clarified that it is not looking for a complete takeover and plans to have a stake of more than 30 percent in Kuka. However, the company is required to make an offer for all the outstanding shares of Kuka.
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The Chinese company stated that the purchase will boost its strategy of diversifying into automation equipment, smart home devices, and robotics. The offer price of $130 per share represents about 60 percent premium over Kuka's closing price of $81 per share on Feb. 3, 2016, a day before Midea increased its share in Kuka to 10.2 percent.
Midea is on an acquisition spree. Earlier this year, the company paid $473 million to take over Toshiba's consumer electronics business. It also made an unsuccessful bid for General Electric's appliance unit. General Electric eventually sold the unit to Haier for $5.4 billion.
Midea's latest deal is likely to attract a high level of scrutiny from the regulators in Germany and the US as it involves crucial technology. Kuka has some of its facilities in the US and counts companies such as Fiat Chrysler Automobiles and Northrop Grumman Corp. as its clients.
Midea was founded in1968 in Guangdong province in southern China. It employs more than 100,000 employees across the globe and owns some of the top selling refrigerator, air conditioning, and washing machine brands in China.
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