ISTANBUL -- This time, Turkey's leading home appliance business came out on top.
Earlier this year, Arcelik was outbid for General Electric's appliance business by Chinese heavyweight Haier. Later, another Chinese company, Midea Group, beat Arcelik in the race for Toshiba's home appliance business.
On Thursday, Arcelik announced that it has signed an agreement to acquire Dawlance, Pakistan's market-leading home appliance company. The $258 million deal is expected to receive regulatory approval and close by the end of the year.
The acquisition will provide Arcelik a foothold in the world's sixth-most populous country, which is expected to grow around 5% a year for the next three years.
It is also expected to give Arcelik's Asia-Pacific growth strategy another boost, following the company's recent $100 million investment in a Thai refrigerator plant.
Privately owned Dawlance was founded in 1980 in Karachi, where it has two manufacturing sites. It has another site in Hyderabad. Its workforce, which is also spread through its distribution, sales and service networks, is 3,000 strong.
It is Pakistan's leading refrigerator and microwave brand, No. 2 air conditioners and No. 3 in the laundry category. Dawlance in 2015 reported $221 million in revenue and $45 million in EBITDA (earnings before interest, taxes, depreciation and amortization).
"Arcelik's recent investments in Thailand and Pakistan [are expected to provide] a strong platform for growth in Southeast Asia," CEO Hakan Bulgurlu said, adding that European markets have reached a "saturation point for white goods" and are beset by "long-term economic malaise."
He continued: "Economic growth in Pakistan is leading to more disposable income and purchasing power whilst technological advances are making white goods more efficient and more affordable. Pakistan's rapid urbanization and social development is seeing the emergence of more single-family dwellings, creating more demand for consumer appliances."
The CEO also vowed to strengthen Dawlance's product offerings and brand position.
Arcelik is owned by Koc Holding, Turkey's largest industrial conglomerate, which is also active in energy, finance, consumer durables and auto manufacturing.
Arcelik had $5.2 billion in turnover last year. It leads Turkey's white goods and consumer electronics markets. With global brands like Beko and Grundig, Arcelik products are sold in 133 countries. Before the Dawlance deal, Arcelik had 10 brands under its umbrella and had become known for its aggressive acquisition strategy across Europe, Africa and Asia.
Arcelik is Europe's third largest white goods producer.
With its $324 million acquisition of South Africa's Defy Appliances in 2011, it became Africa's largest white goods maker.
Arcelik's total workforce after the Dawlance deal will reach to 30,000 across 18 manufacturing facilities, including those in Turkey, Romania, Russia, China, South Africa and Thailand.