Thursday, March 27, 2008

Midea gets nod from SASAC on Little Swan acquisition

GuangDong Midea Electric Appliances Co<000527>, one of China's leading household appliance producers, has won approval from State-owned Assets Supervision and Administration Commission (SASAC) on its plan to acquire a 24.01% stake in Wuxi Little Swan Co<000418>.

The white goods giant agreed last month to pay RMB 1.68 billion (US$235 million) in cash for 87.67 million shares of Little Swan, representing a 24.01% stake of the company's total shares. After the deal, it will become the largest shareholder of Little Swan, the nation's second largest washing machine maker.

The acquisition requires the approval from SASAC as the seller, Wuxi Guolian Development (Group) Co, Little Swan's controlling shareholder, is a state-owned enterprise, said Midea in a statement to the Shenzhen Stock Exchange.

Analysts noted that the purchase would further optimize and improve Midea's strategy in the white goods industry.

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