Rueters have reported today that Fisher & Paykel (F&P) may be rip for a takeover bid. Hmm, wonder who’d be interested in that, eh Mr Whirlpool? It doesn’t take too much industry knowledge, nudges or winks to realise that Whirlpool would probably be first in the queue as they already have some distribution and product sharing deals with F&P.
F&P shares fallen 31 percent so far this year could make it a takeover target, Citi said in research report.
Citi is the second broker to put forward the manufacturer of high-end kitchen and laundry appliances as a target, after ABN Amro said last month that at the current share price it would likely come to the attention of prospective buyers.
“Fisher & Paykel’s intellectual property library and production know-how must be a tempting target for potential acquirers,” Citi analyst Blair Cooper said in a note to clients.
Shares in F&P have lost 31 percent so far this year, compared to a 10 percent fall in the benchmark top 50 index , and are the exchange’s worst performer in 2008 due to a combination of tighter markets, rising costs and a stronger New Zealand dollar.
Citi said that at its valuation of NZ$453 million ($360 million), F&P would cost less than the annual research and development budgets of its much larger competitors, Whirlpool, the world’s largest appliance maker and Electrolux.
Both of those companies would benefit from the F&P’s premium brand and upcoming product releases.
Citi said it now expects F&P to post a net profit of NZ$62.7 million in the year to March 2008, down 8 percent from its previous forecast but higher than the NZ$55.5 million in a survey of analysts by Reuters Estimates.
Fisher & Paykel has been moving manufacturing operations to Thailand and the United States from New Zealand and Australia to cut costs and get closer to key markets.
F&P caters to the top end of the market, as opposed to mass-market rivals such as Whirlpool’s Maytag and Electrolux.
To be honest if this happened it would likely be a sad loss to the industry as F&P have traditionally made not bad machines to be fair to them and their customer service is pretty good as well.