Whirlpool To Offload Majority Of Its EMEA Operations, Forms New Europe Focus Entity

Whirlpool Corporation WHR has completed a strategic review of its Europe, Middle East, and Africa (EMEA) business and entered into a joint venture agreement with Arçelik A.Ş.
Whirlpool will own 25% and Arcelik 75% in the joint venture.
Separately, Whirlpool will divest its Middle East and Africa business to Arcelik. Whirlpool will retain ownership of its EMEA KitchenAidsmall domestic appliance business.
The new entity is expected to have over €6 billion in combined sales and over €200 million in cost synergies.
As previously announced, Whirlpool separately sold its Russia business to Arcelik in August 2022 for up to $260 million of deferred payments. The Russia business will not be part of the new combined company.
Whirlpool expects full-year cash provided by operations and free cash flow to increase by approximately $100 million and $250 million, respectively.
The transaction is expected to close in 2H of 2023.
In connection with the transaction, Whirlpool recorded a non-cash loss on disposal of approximately $1.5 billion in Q4 of 2022.
The transaction is expected to negatively impact FY22 GAAP by approximately $26-$28.
For 2023, Whirlpool expects supply constraints to improve significantly during Q1, as they have already begun to ease.
Price Action: WHR shares closed at $154.29 on Friday.

Overview Rating:

Speculative

0100

Earnings Calendar