Buying Electrolux would add to previous overseas acquisitions by Midea. The Chinese company bought a controlling stake in Toshiba Corp.’s home appliance unit in 2016 and acquired German robot maker Kuka AG a year later, which triggered concerns in the German government.
Midea Chairman Paul Fang hinted at interest in acquisitions in America and Europe in 2017 after the firm participated in the bidding for General Electric Co.’s white goods unit, which was sold to Chinese competitor Haier Group. Samsung Electronics Co. of Korea and Arçelik of Turkey, which did a European deal with Whirlpool Corp. this year, are other competitors.
Midea and Electrolux already have some partnerships, and in 2018 they launched the high-end AEG brand in China together.
Representatives for Midea, which is based in Foshan in southern China’s Guangdong province, and Electrolux, in Stockholm, could not be immediately reached for comment outside usual business hours.
Key to any deal would be getting the support from the billionaire Wallenberg family’s Investor AB, the biggest shareholder in Electrolux. There was speculation in February about Midea’s potential interest.
Electrolux is in the process of laying off 3,800 workers as it seeks to cut costs and turn around its North American business. It reported first-quarter earnings that were better than expected overall, but still showed a net loss, with analysts pointing to negative cash flow.
