General Electric has called off the $3.3 billion sale of its Louisville-based appliances division to Swedish company Electrolux, it announced early Monday.
In a news release, the company said the appliances division "is performing well, and GE will continue to run the business while it pursues a sale."
The acquisition, which would've marked a major move into the U.S. for Electrolux, had been challenged by the U.S. Department of Justice, which asked a federal court to block the deal. The DOJ alleged the acquisition would've raised consumer prices and led to less competition in the consumer appliances market.
Electrolux sells the brands Frigidaire and Tappan in the U.S.
GE Appliances is based at the 900-acre Appliance Park and employs roughly 6,000 people in Louisville, including 3,700 hourly workers. The company has asked for a $175 million termination fee and will pursue other investors for the division, it said in a statement.
Electrolux CEO Keith McLoughlin said in a statement his company is disappointed but would continue pursuing its strategy to grow in the U.S.
"The Group’s operations in North America have proved to be strong on its own merits, with good organic growth and a recovery in earnings during 2015," he said. "Major Appliances North America has a strong presence in the U.S. under the brands Frigidaire and Electrolux, and we are confident that this position will be maintained and strengthened."
UPDATE: Local Officials Weigh In
Mayor Greg Fischer:
“GE Appliances has been, and will continue to be, a great business and integral part of the Louisville community. I have immense confidence that the team will continue to innovate, produce and sell at the world-class levels under the iconic GE brand. As GE explores new opportunities, the city of Louisville will do its part to help grow the workforce and maintain the GE Appliances headquarters here.”
Kent Oyler, president and CEO of GLI, the metro chamber of commerce:
“We are disappointed that the deal will not proceed as previously announced. Both GE and Electrolux have worked tirelessly to complete this transaction. However, when you look at the revenue and share growth, as well as the success of new products introductions, it is clear that GE Appliances remains strong and will continue to be an important factor in their industry.”
