Bosch may soon acquire Whirlpool: find out more

Whirlpool Corporation (NYSE: WHR) is up 20% today following a report that Robert Bosch may be interested in buying the home appliances company. 

Shares of the potential acquiree are still down some 15% versus the start of 2024. 

Why does Bosch want to acquire Whirlpool?

Anonymous sources told Reuters this morning that Bosch may soon bid for Whirlpool to expand its footprint in household appliances. 

The German engineering group is already in talks with advisers to explore the possibility of formally proposing a buyout, they added. 

Whirlpool Corporation is currently valued at about $4.8 billion. Note that the Reuters report does not make it certain that Bosch will definitely move forward with making an offer for WHR. 

Whirlpool stock currently pays a rather lucrative 8.04% dividend yield. 

Watch here: https://www.youtube.com/embed/OkMsYgtyt6s?feature=oembed

Whirlpool has had a major restructuring

Both Whirlpool and Bosch refrained from commenting on the Reuters report on Wednesday. Nonetheless, the news arrives at a time when Robert Bosch is seeing increasing competition from its Asian rivals. 

It is also worth mentioning that WHR unloaded its business in Africa and the Middle East as part of a huge restructuring in recent years. It also separated its European business that’s now under the control of Arcelik (Turkish rival). 

If the German engineering group does indeed proceed with the acquisition of Whirlpool that owns notable brands including Privileg, Hotpoint, Ignis, and Ariston, it would be one of the largest acquisitions it has disclosed to date. 

Wall Street currently has a consensus “hold” rating on shares of Whirlpool Corporation. 

WHR topped sales expectations in Q1

Last month, Stefan Hartung – the chief executive of Robert Bosch revealed plans of a few sizable acquisitions and said his company is comfortable with penetrating a new business area as well. 

The engineering group may also list a few of its divisions on the stock market in a bid to secure financing for such deals, he added earlier this month. 

Bosch was one of the industrial giants that wanted to take over the heating and ventilation assets from Johnson Controls International in March. 

In related developments, Whirlpool recently announced plans of lowering its headcount by about 1,000 in pursuit of improving profit margins. In April, WHR also said its net sales declined on a year-over-year basis to $4.49 billion but still easily topped Street estimates. CEO Marc Bitzer said at the time:

We saw strong performance in Global SDA as well as our international businesses, and announced promotional program price increases in MDA North America consistent with the value of our products and brands to address sticky inflation.

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