Nidec completes acquisition of Embraco
KYOTO, Japan, 8 July 2019: Nidec Corporation on July 1 completed the acquisition of Embraco, the compressor business of Whirlpool Corporation, following the European Commission’s approval, granted on June 26, 2019, Nidec said through a Press communiqué. The acquisition was performed in line with the acquisition plan, announced on April 24, 2018, the communiqué said.
As a result of the acquisition, the communiqué said, Embraco and its subsidiaries became Nidec’s subsidiaries. In addition, certain customary post-closing filings and registrations related to the acquisition of the two subsidiaries in China of Embraco are expected to be completed by September 30, 2019.
According to the communiqué, Nidec has been actively developing a new growth platform, with a particular focus on appliance, commercial and industrial businesses. As part of the strategy, the Company is pursuing strategic acquisitions in the appliance industry, the communiqué said. For this purpose, Nidec has created a new division, called Nidec Global Appliance Division, which mainly consists of Nidec Sole Motor Corporation, acquired in January 2010 and the appliance business of Nidec Motor Corporation, acquired in September 2010. In July 2017, Nidec acquired Secom Group (currently Nidec Global Appliance Compressors GmbH), which enabled the Company to enter into the household and commercial refrigeration compressor market, the communiqué said. Combining with Embraco’s business, Nidec aimed to expand further its refrigeration compressor business, the communiqué revealed.
However, Nidec, through two of Nidec’s subsidiaries will sell its compressor business, Secom, as condition for the European Commission’s approval of Nidec’s acquisition of Embraco, the communiqué said. Although Nidec will sell Secom, the Company believes the acquisition of Embraco will allow Nidec to expand further into the global refrigeration compressor market, the communiqué said. Embraco’s strength lies in industry-leading compressors for household and commercial refrigerators, the communiqué said. Nidec has confidence in further strengthening its refrigeration compressor business through expanding its product portfolio and sales areas, the communiqué said. In addition, ever stricter environmental regulations in major regions like Europe, the Americas and China are stimulating customer demand for eco-conscious and space-saving refrigeration compressors, the communiqué said, adding that Embraco’s advanced compressors meet such customer requirements. Nidec also believes its brushless DC motor technology will complement Embraco’s compressors, the communiqué said. Furthermore, since motors and compressors have similarities in terms of the nature of components used, Embraco expects to reduce procurement costs by taking advantage of synergies of the Nidec group’s purchase capabilities, the communiqué said.
According to the communiqué, the Company believes that this acquisition will bring the Nidec Group closer to its FY2020 sales target of two trillion yen, as both parties’ technological capabilities, brands and customer base come to blend well together.