Mainland leadership seeks to ensure smooth acquisition by Hisense of scandal-hit fridge maker
The mainland's top leadership has intervened to ensure that state- run conglomerate Hisense Group takes control of scandal-ridden Guangdong Kelon Electrical Holdings, the country's largest refrigerator maker.
A subsidiary of Hisense, Qingdao Hisense Air-Conditioner, signed an agreement in September last year to acquire the controlling 26.43 per cent stake in Kelon held by its former chairman, Gu Chujun, who is in jail for alleged economic crimes.
However, the deal almost collapsed last month after Gu refused to sell the stake, deeming the price too low, and his shares looked destined for auction to other companies.
Last Tuesday, the case was discussed at the State Council level, according to a mainland report, and Hisense has increased its offer with a conclusion to the acquisition expected in the next few months.
'Very senior mainland government officials were involved in this deal. This went up to the highest political level,' an investment banker said.
Kelon, which is listed in Hong Kong and Shenzhen, employs 10,000 workers in its home district of Shunde, Guangdong province.