Turkish Arcelik group buys Singer Bangladesh’s controlling stake for $75m

Staff Correspondent | Published: 00:00, Mar 24,2019

 
 

Turkey based home appliance manufacturing group Arcelik to acquire controlling stake of 57 per cent of Singer Bangladesh from Netherlands based Retail Holdings group for $75 million or around Tk 144 a share.
Arcelik and Retail Holdings NV on Friday announced that they had signed an agreement under which Ardutch BV, a wholly owned subsidiary of Arcelik, would acquire Retail Holdings BV, which controlled 57 per cent of Singer Bangladesh shares, in a deal worth of $75 million, said a press release issued from Istanbul.
According to a Singer Bangladesh notice published on Friday, Ardutch will acquire 56.9 per cent or 4,37,07,183 shares of Singer from Retail Holdings.
As a listed company, Singer’s rest of the 43 per cent shares are traded on the Dhaka and Chittagong stock exchanges with general investors holding 20.25 per cent shares, institutional investors 15.45 per cent and foreign investors 7.30 per cent shares.
Based on the number of shares that Ardutch will acquire, it is estimated that the price of each share will be Tk 144 if exchange rate of US dollar is considered at Tk 84.
The transaction will close in April.
There was speculation in the capital market that Arcelik group, the maker of home appliance brand Beko, would buy the majority stake of Singer Bangladesh.
As a result, share prices of Singer shot up from Tk 180 in July, 2018 to around Tk 270 this month.
A high official of Singer Bangladesh told New Age on Saturday that even after the purchase of Singer Bangladesh share by Ardutch, the operations of Singer Bangladesh would continue under the brand name of Singer. ‘It is [share sale] a board level decision. The operations of Singer Bangladesh will continue with the Singer brand name,’ he said.
Arcelik in its statement says that the purchase of majority stake of Singer Bangladesh, one of the leading home appliance retailers and manufacturers in Bangladesh, would help to expand its foothold further in Asia-Pacific.
Founded in 1905 and headquartered in Dhaka, Singer Bangladesh has an extensive product portfolio, ranging from refrigerators to washing machines, televisions to air conditioners, it said.
It has top two positions in major product groups as well as the largest retail distribution network in Bangladesh appliance market.
Singer Bangladesh has 1,507 employees and it reported 2018 revenues of $164 million.
‘Arcelik has been intensively growing in Asia-Pacific in the last decade with greenfield investments in China, Thailand, Pakistan, and India in a bid to establish a trade corridor along the historical Silk Road,’ said the release.
Fatih Kemal Ebiclioglu, president of Turkish industrial conglomerate Koc Holding Consumer Durables Group that owns Arcelik, said, ‘This acquisition is another significant step on our Silk Road strategy. Bangladesh is one of the fastest-growing economies in the world, and it will further accelerate in the medium to long term. The market offers huge potential with its expanding middle class and young population. We will combine our global expertise, scale and knowledge with the strong market position of Singer Bangladesh equipped with its strong brand image, for further product developments to grasp the local market needs.’
Arcelik CEO Hakan Bulgurlu said that their mid-term target was to become the market leader in the major product groups in Bangladesh.
‘Over the next decade, the growth in our industry will come from Asia-Pacific. Singer Bangladesh is a strategic fit for us, and this deal is a unique opportunity to invest in Bangladesh, a market which holds a great untapped potential. Singer Bangladesh has a strong brand heritage, extensive retail network,
and a talented management team. We will continue to build on these strengths by pushing new boundaries and creating strong synergies across retail management, production, purchasing and product sourcing,’ he said.
Retail Holdings chairman, president and CEO Stephen H Goodman said that following the sale, Singer Bangladesh would continue to have a royalty-bearing licence from SVP Worldwide, the owner of the Singer trademark, to use ‘Singer’ in the company name and the ‘Singer’ brand on its stores, products and services. , ‘The Singer Bangladesh business will benefit significantly from the sale as Arcelik is a much larger and financially much stronger company, with a commitment to and a world-wide reputation in the home appliance sector,’ he said.
Founded in 1955, Arçelik offers products and services in 146 countries with its 30,000 employees, 21 different production facilities in 8 countries, Turkey, Romania, Russia, China, South Africa, Thailand, Pakistan and India, 34 sales and marketing companies all over the world and 12 brands (Arcelik, Beko, Grundig, Blomberg, ElektraBregenz, Arctic, Leisure, Flavel, Defy, Dawlance, Voltas Beko and Altus), said the press release.
Arcelik is listed on Istanbul Stock Exchange.

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