WHR - Is Whirlpool Being Taken Over? Here's Why It Would Make Sense.
2024-07-02 07:46:00 ET
Whirlpool (NYSE: WHR) stock rose 17% on the day news broke that Bosch is interested in acquiring the company. Although both companies have declined to comment, a deal would make sense for both parties. Here's why.
According to Reuters, diversified industrial company Bosch is looking at buying Whirlpool to bolster its household appliances business, BSH Hausgerate. Moreover, Whirlpool is arguably a much more attractive company now that it's positioned its European major domestic appliance (MDA) business with Turkish company Arcelik in return for a 25% stake in the new company, Beko Europe. The deal frees up cash resources and rids Whirlpool of a low-margin business burning cash. It also eases competition concerns in Europe for a potential takeover of Whirlpool by Bosch.
A takeover of Whirlpool is attractive for Bosch because it would immediately gain scale in the North American market and would, no doubt, come with the promise of significant synergies given the two companies' complementary home appliance products. There are also potential sales, general, and administrative savings and the potential to share sourcing and distribution channels.
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Is Whirlpool Being Taken Over? Here's Why It Would Make Sense.