Executives at Chinese home appliance manufacturer Qingdao Haier, Ltd. (Haier) have just learned that Ripplewood Holdings placed a bid to purchase Maytag Corporation for $1.13 billion or $14/share. Maytag Corporation, the 3rd largest home appliance manufacturer in the United States, has announced that it will consider competitive offers for the acquisition of the company. Chinese home appliance manufacturer, Qingdao Haier, Ltd. must evaluate the pros and cons of the Maytag Company and assets and decide whether or not to bid on the acquisition of the Maytag business.
Haier will evaluate the current status of its business and the goal to become at least #3 in the U.S. home appliance industry. Haier will then evaluate the current status of the Maytag business and what parts of the business may become assets and liabilities to Haier if acquired. Haier will then determine if the pros to purchase Maytag Corporation outweigh the cons in helping Haier achieve the company’s long-term goals.
Haier will place a bid to acquire Maytag Corporation for $1.28 million or $16/share. With the acquisition of Maytag, Haier will use the company’s innovative product design and marketing strategies to revitalize the Maytag brand presence and gain market share in the U.S. home appliance market, while continuing to market the successful Haier brand in other areas of the world.
Chinese company Qingdao Haier, Ltd. started out as a very low performing refrigerator manufacturer known as Qingdao Refrigerator Plant. In 1984, Qingdao Refrigerator merged with Germany’s Liberhaier Company to become Qingdao Haier, Ltd.
Haier has become one of the top 50 transnational corporations in developing countries. In addition to refrigerators, Haier manufactures a wide range of household appliances including washers, dryers, freezers, microwaves, air conditioners, televisions and mobile phones. All of Haier’s 90 product lines are all marketed under the Haier brand name. Haier was recently named China’s most valuable brand name by Forbes magazine and holds a 30% share of China’s $13 billion household appliance market due to the company’s reputation for product quality, continuous innovation and customer service. Haier trails Whirlpool, General Electric, Electrolux and Bosch-Siemens as the 5th largest house appliance company in the world.
Haier markets products in 160 countries and operates design, production, distribution and after-sales service centers all over the world. Haier America, the U.S. sales and marketing division of Qingdao Haier Ltd., has its headquarters, a research center and product showrooms in New York City. Haier also operators numerous manufacturing facilities at the Haier Industrial Park in Camden, South Carolina and therefore can place a “Made in the U.S.A” sticker on the appliances made in these facilities. Haier America has been quite successful as a result of the company’s reputation for product feature innovation, quick product design and delivery, competitive prices, product quality and the development of new product categories that larger manufacturers have overlooked.
Haier strives to achieve globalization by creating a localized brand name through complete localization of design, manufacture, and marketing of its products.
Global Home Appliance Markets
North America – The North American market is the largest market for large household appliances based on dollar sales, however it is also the most mature market with saturation levels of 80-100% due to the high percentage of households that own numerous appliances. There are four major competitors leading the US Market: Whirlpool, General Electric, Maytag and Electrolux.
Europe – The European Market is a growing market with household appliance saturation levels between 40 and 50%, meaning approximately 50% of...