The Electrolux Group, the world’s largest producer of products for kitchen, cleaning, and outdoor use, has signed an agreement to acquire the trademark and company name “Electrolux” in North America.
At the close of the transaction, Electrolux will get full and worldwide control of its company name and one of its’ most important brand name.
“This transaction will be a cornerstone in our building of a global consumer goods company. We will be able to benefit from our own name in the US – our single largest market.
In the new economy, most successful brands are global brands.
That’s why it’s important that we control the Electrolux name worldwide,” says Michael Treschow, President and CEO of the Electrolux Group. Two years ago, the Electrolux Group introduced a brand policy, which focuses on fewer, bigger and stronger brands, and which uses Electrolux as an endorsement brand for all the product brands.
“Through this acquisition, we will be able to apply this strategy to our more than 5 billion dollar operations in North America. That means we will be able to strengthen our already successful North American brands by associating them with Electrolux, the world’s number one choice,” says Treschow.
“We are also planning to use the Electrolux as a product brand for some of our top-of-the-line European-style appliances in North America.
“The agreement was signed after several years of negotiations with the seller – Electrolux LLC, a US direct-sales company for floor-care products and other healthy home products.
The deal specifies that the Electrolux Group will buy the rights to the brand and company name Electrolux in the US and Canada. Discussions will continue concerning future opportunities for the two companies to work together. Electrolux LLC was created by the founder of the Electrolux Group, Mr. Axel Wenner-Gren.
The Electrolux Group held a minority share of 38% in the predecessors of Electrolux LLC until 1968. Since then, Electrolux LLC and its predecessors have been an independent company and held the rights to the Electrolux name in North America. Electrolux LLC will continue to be an independent company after this transaction.
The purchase price is USD 50 million.
The Electrolux Group will be able to utilize immediately the name on non-floor care products in North America. Electrolux LLC will retain the rights to continue using the name on its vacuum cleaners and after market parts for varying periods of time. There are several contingencies to resolve in the next several weeks to close the transaction, including appropriate filings with US governmental authorities. Says Treschow: “It’s a considerable price tag, but the added value for our business will even be more considerable, especially since a well-managed brand could keep on paying off for decades. I’m very happy we finally found a solution that benefits both us and Electrolux LLC and also creates opportunities for future cooperation.
The Electrolux Group operates in North America under famous major appliance brand names such as Frigidaire, Kelvinator, White-Westinghouse, and Tappan. As the world leader for vacuum cleaners, the Group also operates in the US under the brand name Eureka. Electrolux is the world leader for powered forest and garden tools, with such US brand names as Husqvarna, Partner, Poulan, WeedEater, and American Yard Products.
