Whirlpool selling business unit for $1.08B
A part of Whirlpool Corporation is being sold for $1.08 billion in cash.
Benton Harbor-based Whirlpool Corporation said today it is selling its Embraco compressor business to Japan-based Nidec Corporation.
Brazil-based Embraco is a maker of cooling solutions.
The transaction is expected to close in early 2019, subject to regulatory approvals and customary closing conditions.
The transaction is not expected to have a material impact on Whirlpool Corporation's 2018 financial results.
Citigroup Global Markets acted as exclusive financial advisor on the deal.
The law firm Cleary, Gottlieb, Steen and Hamilton, as well as Linklaters acted as legal advisors to Whirlpool.
Embraco has been a Whirlpool majority owned business unit since 1997.
The business employs about 11,000 people at eight facilities located in Brazil, Italy, China, Slovakia and Mexico. Embraco also maintains commercial offices in the U.S. and Russia.
The Embraco business is currently reported as part of Whirlpool Corporation's Latin America segment. In 2017, Embraco contributed $1.3 billion to Whirlpool's net sales.
As previously announced, Whirlpool expects to cease operations and end production at Embraco's Italy facility, which is subject to a separate agreement with local authorities and unions. Therefore, the Embraco Italy facility is not included in the sale to Nidec Corporation.
On April 26, Whirlpool (NYSE: WHR) intends to launch a "modified Dutch auction" tender offer for up to $1 billion of its common stock, priced from $150 to $170, subject to market conditions.
The company expects to repay the financing amount for the tender offer with its proceeds from the Embraco sale.