Whirlpool, the largest US white-goods maker, raised its offer for Maytag to $1.44bn, or $18 a share, over the weekend in an attempt to put pressure on the manufacturer of the Hoover vacuum cleaner to begin talks.
Whirlpool which is attempting to break up an agreed deal for Maytag by Ripplewood, the private equity group, for $1.13bn was expecting a response by 6pm on Sunday although it was unclear whether Maytag would respond immediately, people familiar with the matter said.
A week ago, Whirlpool entered the bidding for Maytag unexpectedly, offering $1.35bn, or $17 per share. Its efforts were bolstered when a consortium led by Haier, the Chinese appliance maker, decided not to make a formal offer for Maytag. But Whirlpool experienced a setback on Thursday when Maytag said it was unable to conclude that the bid might lead to a superior offer. A concern is the risk Whirlpool’s offer might be blocked by antitrust regulators worried that a combination with Maytag would own too much of the market in products such as washing machines.
Whirlpool has insisted that a takeover of Maytag would not be blocked by regulators. But until now it has been unwilling to state that it would take on the antitrust risk in any transaction.
On August 19, Maytag shareholders are set to vote on Ripplewood’s proposal, which was agreed in May at $14 per share. “By delaying a prompt response and failing to recognise the clearly superior value of our July 17 proposal, the Maytag board has jeopardised this important opportunity for consumers, trade customers and shareholders of both Maytag and Whirlpool,” said Jeff Fettig, Whirlpool’s chief executive.
Some people involved in the bid battle believed Whirlpool’s motive in entering the fray could be a defensive move against the entry of a Chinese competitor into the US market. But Whirlpool’s move to raise its bid after Haier’s withdrawal had defused some of that criticism, they added.
Maytag shares rose 3.5 per cent to $16.20 on Friday.
From MSN Money