A.O. Smith has signed a definitive agreement with CPE Yuanfeng, under which CPE Yuanfeng will acquire an 81% equity stake in A.O. Smith's China business, while A.O. Smith will retain a 19% stake and enter into a long-term brand licensing agreement, according to Zhitong Finance App.
The transaction values the China business at approximately US$400 million on a cash-free, debt-free basis, and the total transaction value is expected to exceed US$500 million when including the net present value of future brand licensing fees.
Closing is expected to be completed in the first half of 2027, subject to regulatory approvals.
According to public information, A.O. Smith's history dates back to 1874, and it entered the Chinese market in 1995, with its China headquarters located in Nanjing.
Its business covers product lines including water heaters, water purification, heating, air purification, and water softening, with commercial water heating and water purification also serving as important segments.
In 2021, the company's China revenue reached a historical high of US$922 million, after which it declined year by year to US$690 million in 2025.
CPE Yuanfeng, formerly known as CITIC Private Equity, manages assets exceeding RMB 150 billion, and this year it has successively completed a US$350 million capital injection into Burger King China and the acquisition of Swiss outdoor brand Mammut.
Callon (CPE)
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