Electrolux has agreed to buy General Electric's (GE) appliance business for $3.3bn (£2.04bn) in what would be the biggest deal in the Swedish company's history.
The world's second largest appliance maker said ownership of GE's brands will enhance its presence in North America, and the size of the transaction strengthens its "commitment to the appliance business".
The deal will help Electrolux take on market leader Whirlpool, whom it has been behind in the US market. GE generates more than 90 per cent of its revenue in North America and last year had sales of $5.2bn.
Electrolux CEO Keith McLoughlin said:
This is an historic moment and important strategic move for the Electrolux Group, which takes our company to a new level in terms of global reach and market coverage.GE’s premium, high-quality appliances complement our own iconic brands and will enhance our presence in North America.
The acquisition will be initially funded by a bridge facility and gradually replaced by capital market and bank financing and a rights issue.
GE said transaction has been approved by its board of directors and will close in 2015.
In a statement GE chairman and CEO Jeff Immelt said:
Electrolux is the right global business for our customers, consumers and employees. We have greatly strengthened this franchise in the past few years.GE Appliances’ people, valuable home appliances brand, products, distribution, and service capabilities make it a perfect fit with Electrolux and its goal of accelerating growth in the U.S.