Fabled appliance company Maytag is being purchased for $1.1 billion by an investment group led by Ripplewood Holdings LLC. The company -- which makes Maytag, Hoover, Jenn-Air and Amana appliances -- will be taken private, removing it from public scrutiny while it struggles to cut costs and respond to intensifying global competition.
Based in Newton, Iowa, Maytag has been squeezed by high labor costs and ruthless foreign competition. Its new owners are expected to move much of its production offshore and try to increase its pentration of foreign markets. Currently, about 12 percent of Maytag's products are made abroad.
Maytag's competitors, including Whirlpool and General Electric, have moved more than half their production overseas, giving them major cost advantages over Maytag. Maytag's domestic workforce is heavily unionized.
The company's quality control has slipped in recent years. An embarrassing design flaw caused mildew to collect in some washing machine models.
Maytag employs about 18,000 workers worldwide, about 1,300 of them at its main plant in Newton. Many of the Newton jobs could be in jeopardy as the new owners work to slash costs.
Maytag also faces new Asian competitors, including LG Electronics, the South Korean manufacturer that stole the spotlight last year with a refrigerator that featured a flat-screen television in its door panel.
Maytag introduced its first washing machine in 1907.
