By Chen Xiaomin

GD Midea Holding, China's second-largest air conditioning maker by sales, will make its first foray into Africa jointly with its old partner Carrier, a unit of US technology giant United Technologies Corporation (UTC).

Midea said Tuesday in a filing on the Shenzhen Stock Exchange that it has agreed to buy a 32.5 percent stake in Cairo-listed Misr Refrigeration and Air Conditioning Manufacturing (Miraco) for $57.48 million.

Miraco is majority-owned and operated by Carrier, the world's largest provider of heating, air conditioning and refrigeration technology, with operations in more than 170 countries.

The targeted company is a leading manufacturer and distributor of residential and commercial air conditioning products in Egypt and Africa. Its sales topped $200 million last year, with a net profit of about $20 million.

Once the deal is closed, Midea will become the second biggest shareholder in Miraco after UTC, whose shares in Miraco will be reduced to 37.1 percent, according to Midea's statement.

Guosen Securities analyst Wang Nianchun said Midea has been advancing its globalization strategy progressively. "After becoming a leading domestic appliance producer in OEM and ODM exports, Midea in 2008 began to sell products overseas in ways similar to methods it employed in China. Now it acquires its brands and production bases via purchases," Wang said.

This is not the first time Midea and Carrier have cooperated. The two companies set up a joint venture plant two years ago in South China's Guangdong Province, producing Carrier-branded air conditioning products to be sold in Europe, Southeast Asia and Latin America.

Midea declined to say whether it will produce Midea-branded products through Miraco, but said in a note to the Global Times that "the convenient geographic location of Egypt, which lies in the interface of Africa, the Middle East and South Europe, and Miraco's distribution channels in Egypt will win Midea cost competitiveness in Africa and the surrounding areas."

Midea called the deal "a second overseas strategic deployment" after its moves to expand in ASEAN countries. It has two plants in Vietnam producing electric and induction cookers, electric kettles and air conditioners.

Midea's other two main businesses are refrigerators and washing machines. Midea's sales revenue hit 47.3 billion yuan ($6.93 billion) last year, with 30 percent coming from exports.

Sinolink Securities is expecting more overseas capital operations as Midea's expansion in the domestic appliance market comes to a climax.

"Miraco's earning capability is stronger than that of Midea. As the deal closes, Midea's earnings per share this year will increase by 0.02 yuan to 1.24 yuan ($0.18)," Sinolink said.