Mexican Company to Bid for Atlas Eléctrica

Mexican appliance company Mabe has indicated it will make a bid for Costa Rica’s homegrown appliance giant Atlas Eléctrica.

The bid seeks to purchase all of Atlas Eléctrica’s common and preferred shares for a total of $72 million.

Mabe, founded in Mexico in 1945, operates 15 manufacturing plants and has a presence throughout the continent. The company exports to the United States through a joint venture with General Electric, which is the company’s largest minority shareholder.

Atlas Eléctrica S.A. is a Costa Rican company founded here in 1961. It manufactures and sells kitchen appliances in all of Central America and the Dominican Republic under its Atlas and Centron brands.

Its goods are manufactured at a plant located in Heredia, north of San José, and the company employs 1,300 people in Costa Rica.

Atlas CEO Diego Artiñano said the company’s high market share in Central America – 50% in Costa Rica, and as much as 60% in other countries – makes the company an attractive acquisition.

Artiñano called it “nothing more than a coincidence” that the announcement came the week after Costa Rica approved a freetrade agreement with the United States, adding that the deal has been in the works for months.

As for what would happen to the Atlas employees, Artiñano said the Costa Ricans working at Atlas’ factory would likely not be disturbed.

Some Atlas employees working on the commercial end of things, however, could lose their jobs as the company merges its management and office workforce with Mabe’s, Artiñano acknowledged.

Mabe now operates in Costa Rica as Eléctrodomesticos Mabeca S.A., where it does business mainly as an importer and retailer.

The bid to buy Atlas Eléctrica must be approved by Atlas investors holding at least 98% of the company’s stock. Though other bids were not solicited, Atlas Eléctrica will consider unsolicited competing bids, according to a statement.

If the offer is accepted, there is a chance Atlas would pull out of the Bolsa Nacional de Valores (Costa Rica’s stock and bond market), said Rafael Nava, a spokesman for Mabe.

“Mabe isn’t on the stock market in Mexico and has not needed that kind of financing in more than 60 years,” Nava said in an e-mail, adding: “But nobody can guess the future.”

Pulling out would continue a trend that has been taking place for years, in which companies have been leaving the Bolsa after being acquired by private (often foreign) capital.

Such has been the case with Corporación BCT, Corporación Interfin, Banistmo (owner of Banex) and Grupo Cuscatlán, according to the daily La Nación.

Atlas’ board of directors is unanimously recommending accepting the offer, and shareholders holding more than 50% of Atlas’ stock have expressed support as well, Artiñano said.

Shareholders will vote on the proposed buyout in a meeting on Oct. 30.