Electrolux Professional Ab Class B · OMXSTO:EPRO_B
Electrolux Professional Ab Class B — Electrolux — Merger or Acquisition (September 2014)
25 slides from Electrolux Professional Ab Class B's merger presentation, Sep 8, 2014
Slide 1: Acquisition of GE Appliances
Acquisition of GE Appliances September 8, 2014 Keith McLoughlin, President & CEO Tomas Eliasson, CFO
Slide 2: Transaction highlights
Transaction highlights • Electrolux to acquire GE’s appliance business • The deal will enhance Electrolux position as a global home appliance company • Attractive valuation with an estimated EBITDA multiple of 7.0-7.3x (FY 2014) pre-synergies • Electrolux takes an important step towards realizing it
Slide 3: A portfolio of strong global brands
A portfolio of strong global brands 3
Slide 4: A transformational step towards our vision
A transformational step towards our vision Our Vision We will be the best appliance company in the world As measured by... ...our customers ...our employees ...our shareholders 4
Slide 5: Agenda
Agenda 1. Transaction overview 2. Strategic rationale 3. Overview of GE Appliances 4. Financial impacts and funding overview 5. Summary / concluding remarks 5
Slide 6: Transaction overview
Transaction overview • Electrolux has agreed to acquire GE Appliances for a cash consideration of USD 3.3 billion Overview • The deal is primarily an asset transaction • Transaction includes GE’s 48.4% ownership in Mabe • Improving global scale in home appliances Rationale • Significant synergies pa
Slide 7: Agenda
Agenda 1. Transaction overview 2. Strategic rationale 3. Overview of GE Appliances 4. Financial impacts and funding overview 5. Summary / concluding remarks 7
Slide 8: Strategic rationale
Strategic rationale A global player in home appliances - Pro forma sales of USD 22.5 billion - Well positioned to succeed in increasingly global and competitive industry 1. Enhances Electrolux presence in North America - Provides scale and leverage to accelerate growth - Broader geographic coverage
Slide 9: Enhances Electrolux presence in North America
1. Enhances Electrolux presence in North America Pro forma revenues by business area (2013) Electrolux Electrolux + GE Appliances(a) Professional Professional Products Products Small Small 4% 5% Appliances Appliances Major 6% 8% Major Appliances Major Appliances Asia Pacific Appliances EMEA 6% Asia
Slide 10: Attractive strategic fit
2. Attractive strategic fit • Well-known brands, with mid/high position Brands and products • Ability to invest in brands and products • Nationwide distribution and logistics network • Local market presence with trade and consumers Retail Focus • Effective retail merchandising • Digital and online
Slide 11: Strategic fit: combining high quality brand portfolios
2. Strategic fit Combining high quality brand portfolios Price Value 11
Slide 12: Significant synergies
3. Significant synergies Run-rate of USD 300 million Synergies Expected synergy breakdown • The deal is expected to generate annual Other synergies of USD 300m ~10% • The largest part of synergies expected in sourcing, operations, logistics and brands • One-off implementation costs of USD 300m • Imp
Slide 13: Agenda
Agenda 1. Transaction overview 2. Strategic rationale 3. Overview of GE Appliances 4. Financial impacts and funding overview 5. Summary / concluding remarks 13
Slide 14: Overview of GE Appliances
Overview of GE Appliances Bloomington, Indiana • Focus on US major appliances - Refrigeration • 2013 revenue of USD 5.7 billion and EBITDA of USD 355 million (excluding Mabe) • Manufacturing footprint across Louisville, Kentucky 5 states – 12,000 employees - Laundry - Dishwashers • Own distribution/
Slide 15: Overview of GE Appliances: brand recognition and asset base
Overview of GE Appliances Strong brand recognition Well-invested asset base 35 Recent USD 1 billion investment 30 Consideration rate by brand ... % of buyers (US) 25 • 10 new product platforms Products • 500+ new products 20 • 6 factory renovations 15 Plants • New assembly lines 10 • Modern equipmen
Slide 16: Broad cooking offering, dishwashers, laundry and refrigerators
Broad cooking offering, dishwashers, laundry and refrigerators Cooking Dishwashers Laundry Refrigerators Broad cooking offering Stainless Steel and Hybrid Top Load High Efficiency Washers Built-in and Freestanding Dishwashers 16
Slide 17: Joint venture with Mabe
Joint venture with Mabe 2013 Sales breakdown (by region) • Leading player in Mexico’s white goods segment Other 7% • 2013 revenue of USD 2.9 billion Canada 13% • Strong brand recognition across Latin America • Attractive brand portfolio and Central & geographic footprint South America 50% • Long-ter
Slide 18: Agenda
Agenda 1. Transaction overview 2. Strategic rationale 3. Overview of GE Appliances 4. Financial impacts and funding overview 5. Summary / concluding remarks 18
Slide 19: Financial impacts
Financial impacts • Combined businesses creates a solid financial foundation to drive future growth • Substantial synergies expected through combined scale and efficiencies • The deal is primarily an asset transaction • The transaction is expected to be EPS accretive in year 1 • EBITDA multiple in t
Slide 20: Key financials (excluding synergies)
Key financials (excluding synergies) Key Financials 2013, USD Electrolux GE Appliances Combined Proforma (incl 48.4% of Mabe) Sales 16.8 billion 5.7 billion 22.5 billion EBITDA 1.1 billion 390 million 1.5 billion EBITDA margin 6.8% 6.8% 6.8% Note: Proforma figures have been converted to USD at an ex
Slide 21: How the transaction will be financed
How the transaction will be financed Financing structure, steps: Uses: USDbn 1. 100% bridge facility Cash considerationa) 3.3 – Bridge financing arranged by Deutsche Bank and SEB Sources: New debt 2.5 2. Rights issue ~25% and bond take out ~75% – Rights issue to be executed following completion Righ
Slide 22: Agenda
Agenda 1. Transaction overview 2. Strategic rationale 3. Overview of GE Appliances 4. Financial impacts and funding overview 5. Summary / concluding remarks 22
Slide 23: Delivering on our growth strategy and vision
Delivering on our growth strategy and vision Our Vision We will be the best appliance company in the world As measured by... ...our customers ...our employees ...our shareholders Brands Enhanced production and EPS accretive in year 1 Innovative R&D capabilities Significant synergy Products
Slide 24: Q&A
Q&A
Slide 25: Factors affecting forward-looking statements
Factors affecting forward-looking statements This presentation contains “forward-looking” statements within the meaning of the US Private Securities Litigation Reform Act of 1995. Such statements include, among others, the financial goals and targets of Electrolux for future periods and future busin