Household appliances shook hands

The owner of the Russian brand of household appliances Jackie’s, Huseyn Imanov, bought out 30% of another domestic vendor Schaub Lorenz. Market participants value the latter company at 1 billion rubles. The parties to the transaction expect that the partnership will allow them to increase revenue and expand their markets, and Kommersant’s sources indicate that Schaub Lorenz is interested in Mr. Imanov’s connections with large retail chains. According to experts, the consolidation of manufacturers may become a new trend in the household appliances market in the Russian Federation.

The founder of Jackie’s (manufacturer of refrigerators, washing machines, etc.) Huseyn Imanov told Kommersant that he acquired 30% in another manufacturer of household appliances, Schaub Lorenz (Shmit Company LLC). According to him, the decision on the transaction was made taking into account “the growth prospects of the household appliances market in Russia against the backdrop of the departure of a number of foreign vendors.” Kommersant’s interlocutor on the market estimates Shmit Company LLC at 1 billion rubles.

“The deal should help double the sales revenue of Shmit Company LLC by the end of the year, and within five years – up to 5 billion rubles,” says Mr. Imanov. He explained that after the deal, Schaub Lorenz’s product range will include televisions, small household appliances and kitchen utensils. Products of both brands are manufactured in China and Turkey under contract.

Kommersant’s interlocutor, familiar with the progress of the transaction, explained that Schaub Lorenz and Jackie’s will not have joint projects, since the brands are “developing in different directions.” “Schaub Lorenz equipment is aimed at the middle price segment, Jackie’s is developing in the direction of luxury electronics,” he clarified.

According to the main beneficiary of Shmit Company LLC, Radmir Sokolov, Mr. Imanov’s offer to purchase “was accepted due to the top manager’s experience in working in international markets.” “We plan to develop not only in the Russian Federation, but also in friendly countries,” explained Mr. Sokolov.

According to a Kommersant source in the market, Shmit Company also needs the deal to develop sales channels in the Russian Federation: access to marketplaces and favorable conditions for cooperation with distributors. Huseyn Imanov “is interested in a share of the proceeds from sales of Schaub Lorenz,” says Kommersant’s interlocutor.

After the freeze of supplies to the Russian Federation of many foreign manufacturers of household appliances, Chinese brands took the main share of the Russian market. Sales of Russian brands also began to grow (see “Kommersant” on February 20).

“Schaub Lorenz probably turned to Huseyn Imanov for financing,” says Dmitry Shashkin, general director of the Kuppersberg household appliances brand. “When choosing the right directions, the partnership has a chance to achieve positive results.”

However, a number of Kommersant’s interlocutors among electronics manufacturers and retailers are skeptical about such cooperation. As one of Kommersant’s sources explains, both brands “do not occupy a significant market share and do not invest in their own developments.” “Shmit Company LLC will not invest the received investments in increasing capacity, building warehouses, and so on, but will only use it to purchase equipment to expand the range,” says Kommersant’s interlocutor.

At the same time, one of Kommersant’s sources among sellers and manufacturers of household appliances believes that “due to large-scale changes in the Russian market,” the number of such consolidating transactions will increase in the future.

Timofey Kornev