Mumbai: Sunil Mittal-led Bharti Enterprises, in partnership with private equity firm Warburg Pincus, is all set to acquire 49% in Haier India, marking the telecom major’s formal entry into the consumer electronics segment.
The transaction, worth around Rs.15,000 crore, comes after Chinese authorities permitted Haier Group to dilute its stake in the Indian arm. Following the deal, Haier will remain the majority stakeholder, with a 49% stake and an additional 2% management stake. The proportional values of investments by Bharti and Warburg Pincus hasn’t been revealed yet.
“The partnership will bolster Haier India’s ‘Made in India, Made for India’ vision by deepening local sourcing, expanding manufacturing capacity, driving product innovation, and accelerating market penetration. The new capital infusion will also enhance Haier India’s competitiveness across the entire value chain,” a press release by Bharti Enterprises said.
The move comes at a time when the demand for consumer appliances is booming, with rising disposable incomes and increasing adoption of premiumised consumer appliances. Haier India offers a wide range of products, including air conditioners, TVs, washing machines, refrigerators and kitchen appliances.
Haier India has been growing at approximately 25% CAGR, supported by its strong portfolio and reach across the country. The company operates two manufacturing facilities in Greater Noida and Pune.
The Chinese-owned company has a significant market share in refrigerators (15%), air conditioners (8%) and LED televisions (8%) and aims to expand its capacity to 4 million units from the existing 1.5 million units. With an aim to achieve sales of $2 billion in the next 3-4 years, Bharti and Warburg Pincus’ involvement is expected to help the brand meet its targets on time.
Since entering India in 2004, Haier has expanded its dealer network to include more than 6,500 outlets, becoming one of its most important markets, amongst China, North America and Russia. The company competes with LG Electronics, Panasonic, Samsung and others in the Indian consumer durables market.
