China's Midea is gunning for German industrial robot maker Kuka with one of the largest ever unsolicited approaches of a foreign company by a Chinese buyer

 
Billy Bambrough
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A Kuka robot makes a cup of coffee at an industry show in April (Source: Getty)

Chinese home-appliance maker Midea is plotting a takeover attempt of German industrial robot maker Kuka, in a deal that values the German company at $5bn (£3.4bn).

If it goes ahead it would be one of the largest unsolicited approaches of a foreign company by a Chinese buyer.

The deal is the latest in a round of recent tie-ups and investments in the robot industry.

The Chinese company, which has a market cap of about $21bn, is offering €115 per share for Kuka – what it says is a premium of 59.6 per cent over Kuka's unaffected closing price on 3 February.

Midea said the offer is subject to a minimum acceptance rate of 30 per cent of Kuka’s issued shares, including the 10.2 per cent stake Midea already owns.

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Kuka's shares jumped to €113 at the open in Frankfurt but have since fallen back to around €105. Shares closed last night at €84.24.

Paul Fang, chairman and chief executive of Midea, said:

As a customer and investor, we have been impressed by Kuka's management and employees and have had constructive dialogue since building our initial stake in the company. KUKA is in excellent condition today and we are committed to investing in KUKA's employees, brand, intellectual property and facilities to further support the company's development.

We believe that a larger shareholding strikes the right balance between an independent KUKA while also putting both companies in a position to drive further growth through collaboration, especially in China.

Fang added the deal is inline with the company's strategy to upgrade "manufacturing competencies" and develop smart home devices.

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Morgan Stanley is acting as exclusive financial advisor and Freshfields Bruckhaus Deringer is acting as legal advisor to Midea on the transaction.

Kuka will remain independent and listed in Germany if the takeover is successful.

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