Haier launches takeover bid for NZ firm

Chinese home appliance giant Haier Group has launched a US$704 million takeover bid for New Zealand's Fisher & Paykel Appliances.

Haier, which already owns 20 percent of Fisher & Paykel, is offering NZ$1.20 (98 US cents) per share for the remaining 80 percent of the company. The cash offer values the company at NZ$869 million.

The offer was announced after the New Zealand stock market finished trading yesterday and just a day after Fisher & Paykel had first said that Haier was planning a takeover bid. Shares in Fisher & Paykel ended yesterday at NZ$1.04, up 39 percent from their close on Friday. Haier's offer represents a 60 percent premium to Friday's closing price.

The takeover is contingent on Haier gaining a controlling 50 percent stake and clearing regulatory hurdles.

Liang Haishan, a director of Haier's New Zealand branch, said in a statement that Haier had reached a lock-up agreement with Allan Gray Australia Ltd, the next largest shareholder after Haier, for its 17.46 percent stake. That leaves Haier less than 13 percent short of a controlling stake.

"We believe the opportunity to receive cash and realize a significant premium over the current share price is attractive for Fisher & Paykel Appliances' shareholders, particularly given market volatility, recent economic uncertainty and the competitive nature of the global white goods sector," Liang said.