Bosch weighing bid for appliance maker Whirlpool, sources say

German engineering group Robert Bosch is considering a bid for US appliance maker Whirlpool (WHR), according to three sources familiar with the matter, a move that would strengthen its position in the appliance market.

To resume

Bosch (BOSCHLTD.NS) has been talking with potential advisers about making a bid for Whirlpool, which has a market capitalization of about $4.8 billion, one of the sources said.

The sources said it was unclear whether an offer would be made and asked not to be identified because the matter is confidential.

Spokespeople for Bosch and Whirlpool said the companies do not comment on “market rumors.” Shares of the U.S. company jumped 20% in premarket trading after the Reuters report was released.

Buying one of the world’s largest appliance makers would significantly strengthen Bosch’s home appliances business at a time when competition with Asian rivals is intensifying.

Whirlpool has undergone a major restructuring in recent years, which has seen it consolidate its European operations into a new company controlled by Turkish rival Arcelik and divest its operations in the Middle East and Africa.

This potential buyout comes as Bosch, the world’s largest automotive supplier, is considering acquisitions to expand its large appliance manufacturing unit.

Biggest deals disclosed

A deal for Whirlpool, whose brands include Ariston, Hotpoint, Ignis and Privileg, would be among the biggest deals disclosed by the German industrial group.

Reuters reported in March that Bosch was among industrial companies competing to acquire heating and ventilation assets worth more than $6 billion from Johnson Controls International in the United States.

Bosch CEO Stefan Hartung told German business daily Handelsblatt in May that the company was considering a few larger acquisitions and was not ruling out moving into a new business or doing a global deal. .

He told reporters earlier in June that the group was open to listing some of its divisions on the stock exchange as it explored financing options for the deals. He did not specify which divisions.

Developing the customer base

Whirlpool, a brand known for large appliances such as washing machines and refrigerators, has sought to expand its customer base in recent years by expanding into smaller appliances such as espresso machines and other kitchen gadgets as it is struggling with a slowdown in its growth.

The Michigan-based company recently announced it would cut about 1,000 jobs in an effort to increase profit margins.

Whirlpool has lost almost 50% of its market value over the past two years. Its Swedish rival Electrolux is down 35% over the same period.

Shares of Electrolux (ELUX-B.ST) rose following the release of the report and were trading up around 4.5% at 10:40 GMT.

(Reporting by Anirban Sen in New York and Emma-Victoria Farr in Frankfurt. Additional reporting by Josephine Mason in London and Alexander Huebner in Munich. Editing by Elisa Martinuzzi, Mark Potter and Jan Harvey)