Sichuan Changhong Electric Co has bid for a controlling stake in Wuxi Little Swan Co as the television maker plans to expand its business into the washing-machine industry.
TV maker Changhong's board of directors has approved the bid for a 24.01-percent stake, or 87.67 million shares, in Little Swan from Wuxi Guolian Development (Group) Co Ltd, Changhong told Shanghai Stock Exchange yesterday.
Yang Jun, director of Changhong's asset management department, said that the company submitted its bid on Friday, the deadline Little Swan set for potential buyers.
Changhong didn't reveal the price, but based on Little Swan's closing price on January 11, the deal will be valued at 1.9 billion yuan (US$264.2 million), or 21.90 yuan per share.
Little Swans shares have been suspended from trading and will resume on February 15. Guolian, the controlling shareholder of Little Swan, said yesterday that it has received applications from potential buyers, without naming them.
Media reports said that Guangdong Midea Electric Appliances Co is also interested in acquiring the stake, but it's still unclear whether Midea has submitted a bid.
"Midea should be more competitive in acquiring the stake as it has experience in the washing-machine industry," said China Galaxy Securities analyst Zhu Lijun.
(Shanghai Daily February 5, 2008)
