1 day Ago By David Richards
Global rating agency Moody’s has labelled Whirlpool the Company that also owns Kitchen Aid as Junk, now the Company is looking to flog assets to prop up the business. Whirlpool whose products are distributed by Arisit a Harvey Norman owned Company based in Melbourne has seen its credit rating cut to junk status by Moody’s Ratings, which cited weak consumer demand, a slow housing market and the company’s high debt load. The Company that owns KitchenAid and Maytag appliances, has been struggling for some time and are now facing new problems due to the introduction of Tariffs in the USA.
KitchenAid meat grinding attachment. Moody’s downgraded Whirlpool to their highest junk rating, with questions now being raised as to whether the business can survive the current economic conditions that US manufacturers such as Whirlpool are facing. The company’s revenue has been dropping since peaking in 2021, as higher interest rates have cut into home sales and renovations, weighing on demand for new appliances claims Bloomberg.
On the upside 80% of the Whirlpool products sold in the US are made in the USA and this could be advantageous for the Company as consumers in the USA look for locally manufactured products. Moody’s claim that as trade wars heat up globally, any economic slowdown from tariffs could weigh on consumers the slowdown in buying new products could delay the company’s recovery. Another problem is that getting cut to junk can boost a company’s borrowing costs.
Moody’s said the company’s outlook is negative, meaning it may face further downgrades in the medium term. In an effort to get out of the position they are currently in the business is looking to sell assets. Private equity funds including Advent International, Bain Capital, TPG Carlyle and KKR are among those approached to invest in Whirlpool’s listed Indian business, the Economic Times reported on yesterday.
Whirlpool is planning to sell a 31% stake in Whirlpool of India which contributes 85% of the company’s Asia revenue, while retaining a 20% interest. The company aims to raise between US $550-600 million through this transaction, launched earlier this month with Goldman Sachs as an advisor, the report stated..
