Arcelik-Arctic

completed

Arcelik is Turkey's leading manufacturer and distributor of major household appliances, with annual revenues of approximately $1 billion in 2001, of which about 25% comprised of export sales. The $50 million proposed project consists of -Arcelik's acquisition of the Romanian based refrigerator manufacturer, Arctic S.A; -following the acquisition, capital expenditures of about US$20 million for capacity expansion and quality improvement to enable exports to neighboring countries; and -restructuring of Arctic's existing debt. The acquisition of Arctic is part of Arcelik's strategy of establishing itself as a strong global player and of becoming one of the top five European white goods manufacturers through international brand name development, export sales, and acquisitions. Arctic's acquisition will allow Arcelik to strengthen its presence in Europe by better using and further expanding existing refrigerator manufacturing capacity (from 350,000 units/year to 750,000 units/year) in the vicinity of Western Europe. In addition, Arcelik wishes to capture the opportunity of existing market share in Romania. Furthermore, Arcelik expects to gain significant market share by strengthening the product range of an already established, well-known brand in Romania and Eastern Europe.