Arcelik acquires Dawlance for $258 mln

[KediKesenFare3]

Arcelik Expands its Business Further into Asia with Major Acquisition
ISTANBUL, June 30, 2016 /PRNewswire/ --

Arcelik, a global player in the home appliances industry, has signed an agreement to acquire Dawlance, Pakistan's leading white goods manufacturer.

Acquisition will help drive Arcelik's growth strategy in emerging markets and its goal to create strong presence in Asia Pacific region, following its recent investment in Thailand.

Arcelik A.Åž. (ARCLK:IST), a global leader in the home appliances industry, has today announced the $258 million acquisition of Dawlance, Pakistan's market-leading home appliance brand, as part of its global expansion into fast-growth opportunity markets.

The transaction will give Arcelik, which is owned by Koc Group (KCHOL:IST), Turkey's largest industrial conglomerate, a significant presence in the world's sixth most populous country at a time of increased economic growth.

Pakistan's economy is forecast to grow around 5 per cent annually for the next three years. It has increasingly prosperous working and middle class, with many aged 20-40, and is rapidly urbanizing, all of which is very favourable for Arcelik.

The acquisition is expected to close by the end of 2016 subject to fulfilment of closing conditions including regulatory approvals.

Dawlance was founded in Karachi in 1980 and remains a privately-owned company. It has two manufacturing sites in Karachi and one in Hyderabad, supporting 3,000 staff across an extensive distribution, sales and service network.

Dawlance is the number one brand in refrigeration and microwaves in Pakistan, second in air conditioning and third in the laundry categories. It reported 2015 revenues of $221 million and EBITDA of $45 million.

(...)
ABOUT DAWLANCE

Dawlance, established in 1980, is a leading manufacturer of household appliances in Pakistan and operates in five categories: refrigerators, air-conditioners, micro-wave ovens, washing machines and freezers. It has been recognized as the 3rd most favorite brand of Pakistan, among all industries, according to an independent consumer survey.

http://www.finanznachrichten.de/nac...ther-into-asia-with-major-acquisition-008.htm

 

[50cent]

Arcelik Expands its Business Further into Asia with Major Acquisition
ISTANBUL, June 30, 2016 /PRNewswire/ --

Arcelik, a global player in the home appliances industry, has signed an agreement to acquire Dawlance, Pakistan's leading white goods manufacturer.

Acquisition will help drive Arcelik's growth strategy in emerging markets and its goal to create strong presence in Asia Pacific region, following its recent investment in Thailand.

Arcelik A.Åž. (ARCLK:IST), a global leader in the home appliances industry, has today announced the $258 million acquisition of Dawlance, Pakistan's market-leading home appliance brand, as part of its global expansion into fast-growth opportunity markets.

The transaction will give Arcelik, which is owned by Koc Group (KCHOL:IST), Turkey's largest industrial conglomerate, a significant presence in the world's sixth most populous country at a time of increased economic growth.

Pakistan's economy is forecast to grow around 5 per cent annually for the next three years. It has increasingly prosperous working and middle class, with many aged 20-40, and is rapidly urbanizing, all of which is very favourable for Arcelik.

The acquisition is expected to close by the end of 2016 subject to fulfilment of closing conditions including regulatory approvals.

Dawlance was founded in Karachi in 1980 and remains a privately-owned company. It has two manufacturing sites in Karachi and one in Hyderabad, supporting 3,000 staff across an extensive distribution, sales and service network.

Dawlance is the number one brand in refrigeration and microwaves in Pakistan, second in air conditioning and third in the laundry categories. It reported 2015 revenues of $221 million and EBITDA of $45 million.

(...)
ABOUT DAWLANCE

Dawlance, established in 1980, is a leading manufacturer of household appliances in Pakistan and operates in five categories: refrigerators, air-conditioners, micro-wave ovens, washing machines and freezers. It has been recognized as the 3rd most favorite brand of Pakistan, among all industries, according to an independent consumer survey.

http://www.finanznachrichten.de/nac...ther-into-asia-with-major-acquisition-008.htm

Is company also into electronic appliance buisness

Waiting for arcelick products in Pakistan

 

[Hakikat ve Hikmet]

It has been in my mind for a long time. That's called a smart move. Now, Turkish companies are positioning themselves along CPEC. Hopefully, ATAK, ADA, Aselpod etc. make a better sense now..

As for Archelik, they have good R&D facilities. If memory doesn't betray me, some folks in my alma meter were working on fuzzy logic based motor controls in washing machines for Archelik. I hope they expand their R&D and production facilities in Pak, so that they can fully leverage CPEC. And, inshaAllah this is just the beginning...

 

[PaklovesTurkiye]

And, inshaAllah this is just the beginning...

YES.......The journey has just begun.

 

[Max Pain]

Good News,
Turkey now seems to continuously engage in Pakistan's private sector which is good,
recently General Mobile which is a Turkish Company has also Introduced its Products.
in a market quite increasingly dominated by Chinese, its good to see some diversity

 

[Devil Soul]

Turkish company to acquire Dawlance for $258 million
By Kazim Alam
Published: July 1, 2016
94SHARES
SHARE TWEET
The new product aims to cut down energy usage and is part of the company’s initiative of designing products that help conserve energy. PHOTO: FILE

KARACHI: Turkish company Arcelik has said it is going to acquire Dawlance, a privately held Pakistani manufacturer of consumer durables, for $258 million.

What will the Warid-Mobilink merger mean?

The deal is likely to be closed by the end of 2016, as it requires approvals from competition authorities, purchase of minority stakes and transferring of land and buildings to the ownership of the company, it said.

When contacted by The Express Tribune, Dawlance General Manager for Sales and Marketing Hasan Jameel said he could neither confirm nor deny the deal.

Earnings snapshot

Dawlance manufactures white goods – which are consumer durables like refrigerators, freezers, air conditioners, microwave ovens and washing machines – in three factories and sells them in local and foreign markets.

Dutch company to buy Engro Foods for around $460 million

Financial accounts of Dawlance are not public because of its private-limited status. However, according to the earnings details Dawlance has provided to Arcelik, it had revenues of $220.6 million in 2015. Similarly, its (adjusted) earnings before interest, tax, depreciation and amortization (EBITDA) amounted to $45 million (roughly Rs4.5 billion) last year. Its net debt amounted to $30 million at the end of 2015, according to Deutsche Bank.

Reason for sale

Although Jameel refused to entertain any questions with regard to the sale of Dawlance, sources close to the sponsors of Dawlance say the company had been on the auction block for the last five years.

Majority shares of Dawlance are owned by Bashir Dawood. He is Hussain Dawood’s brother-in-law, a corporate titan who controls majority shareholdings in HUBCO, Engro and Dawood Hercules groups.

Mobilink completes acquisition of Warid Telecom

Sources say the owner of Dawlance wanted to permanently move abroad. His children have established careers in fine arts and interior designing in Europe and the Middle East and apparently have little interest in managing the family business.

Market share

There are four major players in Pakistan’s white goods market, namely Dawlance, PEL, Haier and Orient. Waves and Kenwood are relatively smaller players, albeit with significant shares in some segments of the durables market.

The microwaves segment is completely dominated by Dawlance in Pakistan with the company controlling about 70% market share, according to market sources.

Dawlance is also the single largest player in the refrigerator segment with up to 45% market share.

In air conditioners, however, Haier owns the largest market share (40%). Dawlance is a relatively small player in this segment with about one-tenth of the market share.

Dawlance to focus on overseas expansion, new markets

Dawlance boasts of having one of the widest dealers’ networks and after-sale networks in Pakistan. It has 37 branches in addition to 750-plus franchises across the country – a fact that distinguishes it from most of its competitors.

Web of companies

Dawlance operates through a complex web of subsidiaries in order to minimise its tax expense, inside sources say.

For example, a group company registered by the name of United Refrigeration Industries manufactures goods and then ‘sells’ to another subsidiary that either sells it onwards to local dealers or exports the durables.

Dawlance jumps on the energy conservation bandwagon

Similarly, another company of the group by the name of Dawlance Real Estate owns a number of properties that are eventually rented out to other companies of the Dawlance group.

These roundabout transactions within the group companies help save dealers in terms of taxes, sources say, thus leaving the dealers with wider profit margins to pocket.