Electrolux is the global #2 in household appliances behind Whirlpool. An attempt to seize the #1 spot through the acquisition of rival GE Appliances for $3.3bn was blocked by regulators in 2015. Electrolux produces a wide variety of white goods for the kitchen and laundry room, as well as vacuum cleaners and other floorcare devices. In addition to the premium Electrolux or AEG brands, it also markets mass-market appliances under brand names including Frigidaire and Eureka in North America; Zanussi in Europe; and Kelvinator, Westinghouse and Simpson in Australia. Its two main markets are North America and Europe, each of which contributes around a third of sales, but it also sells its products throughout Latin America and the Asia Pacific region. Total sales in 2018 reached record highs of SEK 124bn, or around $14.3bn. Kitchen appliances such as fridges and cookers accounted for 65% of sales. In 2011, Keith McLoughlin became the first non-Swedish in the 100-year history of the company. He stepped down in early 2016, to be succeeded by Jonas Samuelsson. The group intends to spin off its much smaller professional kitchen products division - sales of around $850m - as a separate company during 2019. Though publicly quoted, Electrolux is effectively controlled by Sweden's Wallenberg family via their Investor AB holding company. The group was founded in Sweden in 1912 by entrepreneur Axel Wenner-Gren as a partnership with local rivals Lux and Elektromagnetiska, early pioneers in the development of vaccum cleaners and refrigerators. The Electro Lux name was first coined in 1919, and Wenner-Gren eventually merged all three companies under his own management. Zanussi was acquired in 1984; White Consolidated of the US two years later.
Capsule checked 14th March 2019
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Adbrands Weekly Update 14th Jan 2016: Electrolux CEO Keith McLoughlin is step down following the failure of his attempt to acquire US rival GE Appliances. That agreed merger was blocked last month by US regulators on competition grounds. He will be replaced by Jonas Samuelsson, head of Electrolux's European division.
Adbrands Weekly Update 10th Dec 2015: GE abandoned a deal to sell its domestic appliances division to rival Electrolux following a similar legal challenge from the US Department of Justice. The deal would have been "bad for the millions of consumers who buy cooking appliances every year," said a Justice Dept spokesman. "Electrolux and General Electric could not overcome that reality at trial." Electrolux is obliged to pay GE a $175m breakup fee.
Adbrands Weekly Update 5th Nov 2015: The proposed acquisition of GE's appliances division by Electrolux looks set to collapse, after the Justice Department rejected a settlement offered by the two sides. The US government is convinced that a combination of the two businesses would harm competition and is prepared to go to court to block the merger. That case could start as soon as next week. It argues that a deal would leave 90% of the US market for kitchen appliances in the hands of just two companies, from three currently.
Adbrands Weekly Update 2nd July 2015: US regulators have issued a legal challenge to block the acquisition of GE's home appliances division by Electrolux. That $3.3bn deal was agreed in September last year. However, following an investigation, the Department of Justice argues that the combination of the local #2 and #3 in white goods after homegrown giant Whirlpool would result in higher prices for consumers. The Swedish company's response fell just short of accusing the DOJ of protectionism. It said the regulator's lawsuit was "wholly inconsistent with its 2006 decision to approve Whirlpool's acquisition of Maytag - at the time one of Whirlpool’s major competitors on the US home appliance market." As Ali G's Scandinavian cousin might have said, "Is it cos I is Swedish?"
Adbrands Weekly Update 18th Sep 2014: Electrolux will overtake Whirlpool as the world's biggest home appliances specialist following its agreement to acquire General Electric's heritage business for $3.3bn. It is almost certain to retain the GE brand under license. Subject to regulatory approval, combined revenues for the enlarged company would top $22.5bn, compared to around $21bn for Whirlpool, which acquired a controlling stake in Italian rival Indesit over the summer. The key gain for Electrolux is a much stronger presence in the US where it has until now trailed its two homegrown rivals. However a combined GE/Electrolux would become the local leader in cookers and fridge/freezers, and a close #2 in dishwashers. Whirlpool retains a clear lead in washing machines.
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