Newton, Iowa — Fresh blood has entered the fray in the scramble to purchase Maytag, with the acquisition price rising to $16 per share from $14, as the total purchase bid climbed to $1.28 billion from an earlier buyout deal of $1.12 billion.
The latest offer came late last night when Maytag received a preliminary nonbinding proposal from Chinese majaps maker and competitor Haier America Trading, which, along with private equity investment partners Bain Capital Partners LLC and Blackstone Capital Partners IV L.P., put in its bid to acquire all outstanding shares of Maytag for $16 per share cash.
In mid-May, Maytag had agreed to be acquired by an investor group led by Ripplewood Holdings LLC for $14 per share cash. Maytag’s board had given its blessing to this initial proposal.
Yesterday, Maytag’s board said while it intends to proceed with further due diligence with Haier, Bain and Blackstone, there can be no assurance that the preliminary nonbinding proposal would result in a definitive agreement.
“We continue to support the Ripplewood transaction,” said Howard Clark, Maytag’s lead director. “However, we also believe that it is incumbent on us to pursue this possibility of achieving a higher price for our stockholders."
Haier America is the U.S.-based division of the Chinese government-owned Haier Group, China’s largest majaps company. Among the majaps produced by Maytag and Haier are refrigerators, laundry, dishwashers and cooking products.
According to yesterday’s preliminary non-binding proposal, Maytag said completion of due diligence is expected to take six to eight weeks, with the proposal contemplating debt financing provided by Merrill Lynch & Co. on terms and conditions to be agreed upon with the investors.
The second purchase offer for Maytag, a $4.7 billion majaps company focused in North America and in targeted international markets, comes at a time the white-goods producer has fallen on hard times, due principally to its over-concentration of production in the United States. The result has been tumbling sales and earnings, due, in part, to Maytag being faced with greater competition from lower-cost offshore producers, including a wave of Asian majap makers such as Haier.