Reliance in race for stake in Haier: report

Reliance Industries Ltd (RIL) has emerged as a front-runner in the race to acquire a stake in Chinese consumer electronics and appliance maker Haier, The Economic Times reported, citing people in the know.

Haier Appliances India is weighing a plan to dilute 25-51% equity, following which an Indian entity becomes the largest shareholder.

Owning more than 25% or even up to 51% would make the new buyer the largest shareholder among all others.

The Chinese white goods maker, ranked third after LG and Samsung, has been seeking an up to $2.3 billion valuation, which includes a control premium.

RIL is pitted against a consortium that includes Sunil Mittal of the Bharti Group.

Haier appointed Citigroup Capital late last year to tap large family offices and private equity funds for stake sales.

In March, Mint reported that global private equity firm Texas Pacific Group (TPG) Capital and Singapore’s sovereign wealth fund GIC are competing for a 49% stake in the Indian operations of Haier.

The proceeds from the stake sale are expected to support expansion plans at Haier, which had allocated over ₹1,000 crore between 2024 and 2028 to establish new air conditioner production and injection molding units, the Mint report said.

This follows a ₹2,400 crore investment in its Pune and Greater Noida plants.

In December, Mittal had formed a consortium with Warburg Pincus.

The other group in fray for a stake in Haier include TPG and the Burman family of Dabur, Goldman Sachs and the Amit Jatia family, and GIC of Singapore with BH Goenka of Welspun after initially joining forces with Uday Kotak.

Since entering India in 2003, Haier has maintained a manufacturing presence, with the main factor in Greater Noida, where a new air conditioner unit and injection molding facility have increased production from 1.5 million to 4 million units per year.