Whirlpool Boosts Bid for Maytag

For a second time, Whirlpool Corp. has sweetened the pot in a bid to purchase rival Maytag Corp., submitting a $20-a-share binding offer worth $1.62 billion plus assumed debt.

“Our binding offer reflects both the value we see in the combination of Whirlpool and Maytag and the confidence we have in the ultimate receipt of regulatory approval for the transaction,” Jeff M. Fettig, Whirlpool’s chairman and chief executive, said in a written statement.

The bid, a $2-a-share premium to Whirlpool’s latest offer, was presented one day before its deadline to make a firm proposal. Both companies had agreed on the cutoff date.

Whirlpool, based in Benton Harbor, Mich., about 85 miles southwest of Grand Rapids, said it would pay half the new purchase price in cash and half in stock. The company would assume $977 million in debt as part of the deal for a total transaction of $2.6 billion.

Maytag spokesman John Daggett confirmed that the Newton, Iowa-based company received the proposal but declined to comment further.

Whirlpool’s offer was 43% higher than an initial bid of $14 a share, or about $1.13 billion, submitted by investment group Triton Acquisition Holding Co. Maytag’s board accepted that all-cash offer May 19 and shareholders are scheduled to vote on it Aug. 19.

Whirlpool said its bid would expire the next day. The offer includes a commitment to pay a “reverse breakup fee” of $120 million if regulators do not approve the combination, along with $15 million to retain Maytag’s employees.

Whirlpool also agreed to pay a $40-million termination fee that Maytag would owe Triton if the investment group’s bid was rejected.

Whirlpool has “put enough money on the table, they think, to preempt further bidding” by other interested parties, said Kevin O’Mara, a New York attorney who specializes in corporate mergers.

“They’re clearly looking to get this acquisition done,” he said.

Whirlpool initially submitted a tentative offer of $17 a share, or $1.35 billion, on July 17 that was contingent upon the company being given full access to Maytag’s financial data. Three days later, it raised the tentative offer to $18 a share, or $1.43 billion.

Maytag, the nation’s third-largest appliance maker, agreed July 26 to open its books to No. 1 Whirlpool. The two companies agreed that Whirlpool had until today to submit a firm offer.

Maytag shares jumped $1.60, or 9%, to $18.58. Whirlpool rose $2.75, or 3%, to $82.46.