In the second major sale this week of a Japanese manufacturer to a Chinese behemoth that Australian shoppers would scarcely know, Toshiba will transfer its home appliances business to the Chinese Midea Group.
In a statement, Midea said that by leveraging each company’s complementary capabilities and resources, the two enterprises will jointly explore growth opportunities. One of these initiatives is the DA under which Midea will acquire an 80.1% stake valued at US$473 million, in Toshiba Lifestyle Products and Services Corporation (TLSC), which is the home appliances arm of Toshiba.
The business will continue to develop, manufacture and market whitegoods, such as refrigerators, washing machines, vacuum cleaners and other small domestic appliances under the Toshiba brand name and the current company name. All employees of TLSC group engaged in the business will continue to work with TLSC group.
The Chinese company will be licensed to use the Toshiba brand worldwide in relation to the business for the next 40 years, yes that’s 2056. Additionally, Midea will receive more than 5’000 IP assets and a license to use other home appliance related intellectual properties retained by Toshiba.
Toshiba president and CEO Masashi Muromachi, explained “We are glad to witness the fruition of our strategic partnership with Midea, crystallized by this transaction.”
“The home appliances business has long been an important part of our company, culture and brand image. In the process of identifying a trusted partner, we carefully looked at track records, capabilities, resources and commitment to the Business.”
“Midea and Toshiba have more than 20 years’ successful cooperation in various areas and have built a good mutual understanding. We are impressed by Midea’s focus on globalization, strong product development capabilities, extensive global distribution network and commitment to high quality. I am confident that Midea’s further investment in R&D, marketing and branding will bring about a brighter future for the home appliances business,” Muromachi continued.
Fang Hongbo, Midea chairman and president commented, “With a strong global home appliance and HVAC business, the addition of Toshiba Home Appliance, its iconic brand, talented team and leading technologies, will significantly strengthen our competitiveness in Japan, Southeast Asia and the global market.”