Electrolux buys Anova to tap into connected products growth

STOCKHOLM (Reuters) - Swedish home appliance maker Electrolux said on Monday it was buying precision cooker maker Anova in the United States as it looks to accelerate its development of connected devices for kitchens and homes.

The Electrolux logo is seen during the IFA Electronics show in Berlin, Germany September 4, 2014. REUTERS/Hannibal Hanschke/File Photo

Home appliances that can be connected to smartphones are one of the emerging technologies and features that are expected to be a growth area for white goods makers in the years ahead.

Paying $115 million cash for Anova, which sells an immersion cooker that is linked through a smartphone to thousands of recipes, Electrolux hopes to leverage its direct sales business model and boost its own connected products business.

“This is a space we are developing in and learning in and this is a way for us to accelerate that learning in terms of smart, connected devices,” Electrolux CEO Jonas Samuelson said.

Samuelsson also said Electrolux wanted to leverage off Anova’s direct marketing and sales network and learn from its experience in creating a user community among the 500,000 people who have bought its products.

San Francisco-based Anova had sales of around $40 million in 2016 and Samuelson said it was “solidly profitable” despite still being in a phase of rapid expansion.

Electrolux said it will pay an additional up to $135 million depending on the future performance of Anova and will establish a smart home solutions center in San Francisco to boost the development of connected products in other categories.

The company, which is eyeing other growth avenues after a failed attempt to buy General Electric’s white goods business, later sold to China’s Haier Group, already makes connected air conditioners, cookers, washing machines and driers.

Samuelson said Electrolux will now also focus on areas like climate control and air quality.

“This is a space where connectivity and out-of-home control and optimization ... is really taking off in terms of smart and connected solutions,” he said.

Reporting by Simon Johnson, additional reporting by Johannes Hellstrom; editing by Niklas Pollard