(Jan 6): A little-known Japanese maker of oven ranges and water heaters has offered to acquire Fujitsu General Ltd for as much as ¥257 billion (US$1.6 billion or RM7.3 billion), becoming the latest suitor for Fujitsu Ltd’s air-conditioner unit.

Paloma Rheem Holdings is offering to pay Fujitsu General stockholders ¥2,808 a share — a 24% premium to its Jan 6 close — or as much as ¥164.7 billion. Parent Fujitsu will separately sell its stake in the unit for roughly ¥92 billion, the Japanese company said in a statement. Paloma Rheem intends to finance the deal through bank borrowing and launch a tender offer around July, Fujitsu said.

Japanese information technology firm Fujitsu, which in its heyday made everything from laptops and chips to mobile phones and appliances, has hived off much of its consumer product line-up to focus on communications and information technology systems for businesses. The company had aimed for a quick sale of its stake in Fujitsu General as it shed non-core operations.

It engaged with private equity firms Bain Capital and KKR & Co and Swedish manufacturer Nibe Industrier AB, though negotiations stalled over price. Paloma Rheem and Fujitsu had previously collaborated on the development of air conditioners in North America.

In a separate deal, Fujitsu agreed to sell its chip packaging subsidiary Shinko Electric Industries Co to a group led by the government-backed Japan Investment Corp for about US$2 billion. That sale took years of negotiations, once attracting interest from foreign private equity firms including Apollo Global Management Inc, Bain and KKR. Battery manufacturer FDK Corp is another unit up for sale.

Uploaded by Tham Yek Lee