Whirlpool India's shares fell 20% to Rs 1,262.15 in early trade on Thursday after the company announced that its holding company, Whirlpool Corporation, intends to sell a 20% stake in the company.
Whirlpool Corporation announced in its fourth-quarter earnings release that it intends to reduce its ownership of Whirlpool of India Ltd. to about 20% by mid to late 2025. The sell-down will take place during one or more market sales.
"Pursuant to Regulation 30 and Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ('Listing Regulations'), read with SEBI Circular No. SEBI/HO/CFD/CFD-PoD1/P/CIR/2023/123 dated July 13, 2023, we hereby notify the Stock Exchange of the receipt of the enclosed communication from Whirlpool Corporation, the Company's Ultimate Holding Company." Whirlpool Corporation disclosed the Anticipated Sell-Down information as part of its earnings release, which was led by the United States Securities and Exchange Commission," according to Whirpool India's exchange filing.
Even after the planned sell-down, Whirlpool Corporation, which currently owns 51% of Whirlpool India, plans to continue to be the company's largest shareholder.
Whirlpool Corporation expressed confidence in the company's long-term growth prospects and said that Whirlpool India will continue to be a significant part of its portfolio despite the reduced stake. The company thinks that by taking this calculated risk, Whirlpool India will gain greater independence and be better equipped to adjust to the shifting market conditions.
This increased autonomy is expected to allow Whirlpool India to focus on accelerated growth and additional investments in its business, leveraging its strong financial position. Whirlpool Corporation also assured that brand licensing and technology agreements, as well as transition commitments, would continue to support Whirlpool India's operations and long-term growth as a trusted brand in India.
Whirlpool Corporation stated that it believes these actions will ultimately provide value to Whirlpool India shareholders.
