Arçelik buys Defy in $327bn takeover deal

Ayanda Mdluli

Home appliance maker Defy Appliances had been taken over by Turkish conglomerate Arçelik Group in an acquisition worth $327 million (R2.22 billion), the company said yesterday.

Arçelik Group said it had entered into an agreement to acquire Defy Appliances from Swiss home appliance maker Franke Holdings.

Defy has been operating in the home appliances sector for about 100 years and runs three factories in Jacobs, south of Durban, Ezakheni in Ladysmith and East London.

Ross Campbell Heron, the chief executive of Defy, said that Arçelik had been a major strategic supplier of products to Defy for many years.

He said: “We have enjoyed an excellent relationship with the Arçelik Group and have great admiration for their technology resources and their impressive manufacturing facilities.”

Heron said the acquisition would provide new prospects in future, in terms of development of the company’s manufacturing base and its expansion plans in sub-Saharan African markets. Defy recorded net sales of about R2.5bn in 2010.

It employs more than 2 600 people and exports to a variety of markets, including Africa and the Indian Ocean islands.

Arçelik, which employs about 19 000 people globally, operates in the consumer durables and consumer electronics sectors.

The subsidiary of leading Turkish conglomerate Koç posted a consolidated turnover of e3.5bn (R34bn) in 2010, with international sales of e1.8bn.

Levent Cakiroglu, the chief executive of Arçelik, said the company was consistently looking to expand its international presence from both a manufacturing as well as branding perspective.

Irvin Jim, the general secretary on National Union of Metalworkers of SA, said the union had contacted Defy to set up a meeting to discuss issues around the takeover.

He said any takeover or acquisition should be conducted in a way that would defend existing jobs.