Midea Buys Control of Israeli Automation Company

(Beijing) — Chinese electronics giant Midea Group acquired more than 50% of the Israeli automation company Servotronix, Midea Chairman and President Fang Hongbo told Caixin Monday.

While Fang didn’t disclose the terms, Israeli media reported that Midea valued Servotronix at $170 million, citing Servotronix Chief Executive Officer Ilan Cohen. Fang didn’t comment on that valuation in the Caixin interview.

Fang told Caixin that the controlling stake in Servotronix is part of the appliance maker’s strategy of expanding into automation and smart manufacturing, continuing a series of acquisitions. Midea disclosed the deal Feb. 9, saying it won all necessary regulatory approvals.

Founded in 1987, Servotronix develops automation solutions focused on motion control for a diverse range of industries including robotics, medical equipment, machine tools and electronics. The Petah Tikva-based company also has subsidiaries in China and Germany, where Midea recently acquired one of the world’s largest robot makers.

According to the Israeli media report, Cohen and another major shareholder, Israeli billionaire Ruth Wertheimer, are expected to jointly sell around 48% of Servotronix in the transaction.

The purchase extends Midea’s expansion in robotics, industry analysts said. Last month, Midea closed a deal valued at more than 4 billion euros to become the largest shareholder of German robot maker Kuka AG.

In 2015, Midea set up two joint ventures with Yaskawa Electric Corp., a Japanese robot maker, to develop and manufacture industrial and service robots. Yaskawa is one of the world's four biggest industrial robotics companies, along with domestic rival Fanuc, Kuka and Switzerland's ABB.

Contact reporter Han Wei (weihan@caixin.com)