Haier Smart Home has entered into a transaction with the Electrolux Group in Sweden to acquire 100 per cent equity interest in Electrolux South Africa Proprietary Limited (ESA).
The South African subsidiary has a water heating business valued at $US137 million.
South Africa is the second largest economy in Africa with a population of 61.4 million.
ESA owns the century-old water heater brand Kwikot that specializes in diversified products and solutions of electric water heaters, solar water heaters, multi-energy solutions, gas water heaters and heat pumps.
It is the leading water heater manufacturer in South Africa, with a double-digit EBITDA margin. Kwikot operates well-established distribution channels, installation network and after-sales service system to provide users with speedy response and quality services.
The acquisition is an important step in the strategic implementation of Haier Smart Home's development in African market.
Leveraging Kwikot's extensive HVAC channel and service coverage, Haier Smart Home will realize synergies in product and supply chain management to expand Kwikot's water heater lineups and unlock potentials in solar water heaters and water purifiers.
In addition, Haier Smart Home will also accelerate its refrigerators and laundry businesses with the help of Kwikot's strong local distribution channels.
Haier Smart Home has been able to double its revenue every year for the past three years in Middle East and African markets where its freezers ranked number one in Nigeria, high-end air conditioners revenue grew 122 per cent cumulatively in Egypt and high-end washing machines grew 30 per cent in Ghana.
The transaction is subject to regulatory approvals and is expected to be completed in the fourth quarter of 2024.
Founded in 1984, Haier Smart Home, one of the subsidiaries of Haier Group, is the world's largest home appliance manufacturer.
Haier Smart Home has built up seven world-class premium home appliance brand clusters globally, including Haier, Casarte, Leader, GE Appliances of the United States, Fisher&Paykel of New Zealand, AQUA of Japan, and Candy of Italy, and the world's first scenario brand, SANYINIAO.