Home Equipment: an industry on the move

Through its Consumer Goods Investment Banking team, Societe Generale stands as a strong and trusted partner of the home equipment players, supported by its involvement in all the major 2024 transactions. Cyril Paolantoni comes back to the origins of the consolidation wave in this industry and provides his views on the trend for the coming years.

Since 2018: A shaky market

In the early 2020s, lots of movements were observed in the home equipment sector. 2018 was a pivotal year, marked by two large transactions in Europe, Candy and Gorenje, respectively acquired by the Chinese players Haier and Hisense. Since then, historical Western leading players have had to shrink, like Whirlpool exiting Europe in 2023, and Electrolux, forced to withdraw from Middle East Africa region. Indeed, growing Asian groups such as Haier, Midea or SharkNinja have been making acquisitions and gaining market shares across the entire range of home equipment, from large to small appliances, also including televisions, air conditioning, heating and other electronic devices.
Except in 2020 and 2021, an interlude of exceptional growth, marked by the Covid and the lockdown period highly boosting this industry, the last few years have been correction years, with a downturn happening in 2022. The emergence of new conflicts, inflation, and the purchasing power crisis in Western countries accelerated the consolidation wave that started in the early 2000s under the pressure of low-cost manufacturers both in Asia and Eastern Europe.

2024: Another wave of consolidation

After four years on hold since the pandemic, 2024 will remain the year of the M&A recovery. Home equipment groups carved out activities that were no longer strategic for them, or that had become secondary, and went beyond portfolio reviews, making more strategic refocusing and premiumisation decisions. Hence, Societe Generale’s Consumer Investment Banking team successfully supported major transactions illustrating those trends. The Bank acted as financial advisor in all the key transactions all over 2024.
We advised Sonepar Group on the disposal of Cylinda, the third largest home appliance company in Sweden, to the Turkish group Vestel. Cylinda was not a core business to Sonepar and is now in good hands to develop its large appliances activities all over Scandinavia under Vestel umbrella.
We also advised Electrolux on its disposal of Kwikot (South Africa) to Haier (China), of Rosenlew (Finland) to Helkama (Finland) and of Zoppas (Italia) to Expert (Italia). These disposals are part of the new strategy of Electrolux to refocus on its major premium brands and core geographies only.
Another remarkable event was the share capital opening of Robot-Coupe/Magimix, a leading player in small commercial and domestic appliances in Europe and the US, to the Private Equity fund Ardian. This latest transaction, in which Societe Generale advised the shareholder family of Robot-Coupe/Magimix, was the largest transaction in the consumer goods industry in 2024 in Europe and one of the largest in appliances ever.

2025: The year of the recovery?

Historically, the market trends of home equipment industry proved to be highly cyclical. As most of them are non-essential products, the industry trend has always amplified the economic cycles, both on peaks and downturns. Besides, still based on historical analysis, a full cycle including up and down usually lasts between five and seven years.
It implicitly means that, after this five-year period from 2020 to 2024, the current year 2025 could be the one for the market to move up again. However, amid a still low growth in Europe, non-ended conflicts and many uncertainties around the US economic policy, we see 2025 as a transition year with a rather stable but not yet growing market. But, whatever the timing of the market recovery, 2025 or 2026, after around six waves of consolidation in the last 25 years, this home equipment industry remains highly fragmented, and many M&A transactions are still expected in the coming years.

The ability of Societe Generale to capture such a deal flow in this consumer vertical proves once again the relevancy of our sector-based Investment Banking model. In the consumer world, brands and products have become mostly global, and clients appreciate more than ever our global views on their industry.