Chinese and Spanish household appliance manufacturers invest €60m in European refrigerator factory
China-based Haier and Spanish business Fagor will establish a joint venture (with shares of 51% and 49% respectively) to serve as the European refrigerator production platform for both companies. The new site in Wroclaw, Poland, forecasts an annual production capacity of 500,000 units which is expected to increase to 1 million units within 5 years.
Clearwater International served as Fagor’s advisor during the transaction.
This groundbreaking transaction is the first of its kind in the sector: two global leaders in the white goods sector have joined forces in addressing the European market. This transaction not only involves an industrial and technological angle, but also allows for developing market access to the EU and fostering unique R&D that combines Chinese and EU innovations.
The strategically located Poland-based factory will strengthen Haier’s position in Europe by bringing its R&D, production and marketing closer to its sales territory, whilst also bolstering Fagor’s competitive position in Europe and Asia. The construction of the refrigerator factory is due to begin in September 2013 and production is expected by June 2014.
The Chinese government’s Go Global strategy has encouraged enterprises to invest overseas for a number of years, using foreign exchange reserves to accelerate overseas expansion and acquisitions by Chinese companies. Access to new markets, talent and IP protection makes the policy even more attractive to successful Chinese brands. As Chinese investors saw a gap between expected annual investment returns and actual returns in 2012, it is expected that more investors will consider seeking opportunities abroad in the future.