Lahore (Muhammad Yasir) Arçelik A.Ş. and Hitachi Global Life Solutions, Inc. (“Hitachi GLS”) have signed a share purchase agreement to establish a new joint venture company. This historic partnership creates a major player in Asia-Pacific – the world’s largest home appliances market, to expand global sales through a joint competitive supply-chain.
As part of this $300 million transaction, Hitachi GLS will establish a new company into which it will transfer its global home appliances business outside of Japan. Arçelik will acquire 60% ownership in the new company, which both partners aim to establish in the spring of 2021, after regulatory approvals.
Arçelik has consistently expanded its home appliance business in over 145 countries around the world. It is the 2nd largest manufacturer in Europe, while achieving strong growth in South-Asia. Hitachi GLS currently operates mainly in Southeast Asia and the Middle East, where it enjoys a high-end brand image. The joint venture will manufacture, sell and provide after-sales services of Hitachi branded home appliances (including refrigerators, washing machines, vacuum cleaners etc.) globally outside of the Japanese market.
Arçelik and Hitachi GLS plan to build a competitive value-chain, leveraging the complementarity of both companies’ strategies, creating growth opportunities that will increase their access to new markets, enhance their product ranges and sales capabilities, while delivering increased competitiveness and other geographic advantages across the supply-chain and production operations. The joint-venture encompasses two manufacturing companies and ten sales companies of Hitachi GLS group, outside Japan, engaging 3,800 employees. This portfolio generates over $1.0 billion in sales revenues.
Energy efficient technologies and expertise of both firms will be combined to add more sustainability to business, enabled by joint efforts in key areas like; R&D, procurement and production systems, with the aim to expand the sales of Hitachi branded products in Europe, Asia and Africa.
Umar Ahsan Khan – the Chief Executive Officer of Dawlance – the wholly-owned subsidiary of Arcelik in Pakistan stated that: “It is delightful to see this resourceful collaboration between two global enterprises. This partnership promises economic advantages for Pakistan as well, especially Dawlance, being the No.1 Home Appliance Brand in Pakistan. We have the ambition to take maximum advantage of this brand-enrichment, broader vision and international synergies. With this Joint Venture with Hitachi, a leading brand in Asia-Pacific, Arçelik will soon emerge as a major force in region.”