Advances Fusion, July-August, 2016

Vol. 6, #6, July-August 2016, No. 60

Midea Breaks into Fortune 500

Midea Group entered the for the first time, ranking #481

1 Advanceswww.midea.com Fusion, July-August, 2016

ADVANCES

Contents

NEWSLINE , Midea Complete KUKA Midea Enters Global Fortune Transfer of Toshiba 500 Page 3 Appliances Business PAGE 9 Midea Announces Results of Kuka Takeover PAGE 13-14 2 Products Named Best of the First Brand Store in Moscow Best in Germany PAGE 10 PAGE 4 FUSION

Land of Caves and Ancient Chiller Installed in Tajikistan Profit up 14% Year-on-Year Ministry of Foreign Affairs PAGE 10 Trade Routes PAGE 15-18 PAGE 5 From Stravinsky to German Certification PAGE 5 Brand Merges with Springer Solzhenitsyn PAGE 19-22 in Brazil PAGE 11-12 IoT Relationship with Californian Network PAGE 6

Cooperation with Jordanian Feature in Brazil’s Largest Page 12 Princess PAGE 7 Finance Paper Midea Climbs the Forbes 500 PAGE 8

Workers Volunteer in Flood- Hit Areas PAGE 8

Midea Advances Newsletter is published monthly by Midea International Business. We welcome all Quote of the comments, suggestions and contributions of articles, as well as requests for subscription to our Month: newsletter. You can reach us by phone at (0086) 15014690097 Or by email at: [email protected]

“In business, Address: ADVANCES, Midea International Business what’s dangerous Midea HQ No. 6 Midea Road is not to evolve.” - Beijiao, Shunde, , P.R.C. 528311 Jeff Bezos

Web: www.midea.com/global

2 Advances Fusion, July-August, 2016

NEWSLINE

Midea Enters Fortune Global 500

By Midea

M idea became the first compa- ny from the Chinese household appliances industry to enter the Fortune Global 500 list, when the updated ranking of the world's largest corporations was an- nounced on July 20, 2016. Midea debuted at 481st after a strong 2015 that saw the company achieve US$22.17 billion revenue, and total profit of US$2.02 billion, representing a 21 percent year-on- year increase. "In 2015 the global home appliances industry faced more challenges, and Midea was able to fly upwind by adhering to the strategy of developing cutting-edge prod- ucts, improving efficiency and emphasizing global opera- industrial robotics group Kuka AG and Italian air-conditioning tions." said Andy Gu, Vice President at Midea Group. manufacturer Clivet. Midea's global strategy is to switch from Midea has invested US$3 billion in research and devel- traditional product exportation from to operating locally opment over the past five years and now operates R&D insti- in key markets. tutes in China, the United States, Japan, Germany, Italy and Midea's global platform now operates more than 200 sub- Singapore, integrating global resources to drive technological sidiaries and 9 strategic business units, and the company runs breakthroughs. This is in addition to an US$1.04 billion in- seven full-scale operations covering R&D, manufacturing and vestment in improving automation which has resulted in an sales in 6 countries including Vietnam, India, Belarus, Egypt, average current automation ratio of 17 percent. Brazil and Argentina. Midea products are sold in more than 200 So far in 2016, Midea has acquired Toshiba's home ap- countries and regions worldwide. pliance business, and is in the process of acquiring German The company also landed several high-profile projects in 2015, including winning the bid to install central air-conditioning in the stadiums for sports games in Brazil. "Midea is dedicated to helping people rediscover what home means, in a surprisingly friendly way," said Brando Brandstaeter, Head of Brand & Communication of Midea International Business. "In the future, Midea will become a conglomerate focused on smart home appliances and intelligent manufacturing."

3 Advances Fusion, July-August, 2016

NEWSLINE

First Brand Store in Moscow

By Ekaterina Korablyova

M idea held the grand opening of its first brand store in Moscow, Russia on July 21, a major move to further expand the company's brand and products in the Russian market. The Moscow brand store, located in Techno Mall Gor- bushkin Dvor, Bagrationovski Proezd, 7 is Midea's second store in Russia. With an area of 90 square meters, the store is open daily from 10:00-21:00 and brings comprehensive mod- ern home appliance products including microwave ovens, hoods, hobs & ovens, dishwashers, and vacuum cleaners to Russian consumers at reasonable prices. Qualified counselors will help customers choose the appliances that meet all de- 2016, and this amount is expected to reach two million by 2020. To ensure that its innovative products are reliable and time-tested, Midea adopts strict quality control measures and has also established an after-sales service network of 266 authorized service centers across Rus- sia. "It is our goal to bring comfort and warmth to the home by introducing our home and kitchen appliances to our customers in Russia," said Ekate- rina Kora- bleva, Midea brand manager in mands and arrange delivery and installation after purchase. Russia. "Midea is Midea's long-term strategy in Russia is to develop a large helping people re- retail network that not only collaborates with major federal discover the mod- and regional retail chains such as M.Video and Poisk, but also ern concept of operates exclusive brand stores to improve its recognition 'home' and contrib- among Russian consumers. uting to people With sales of 25,000 units in 2012, Midea has been ex- being able to enjoy panding in Russia and has become the third largest in the every moment country. According to Alexey Obukhov, general director of spent at home." Midea Russia, the company has already sold 675,000 units in

4 Advances Fusion, July-August, 2016

NEWSLINE Chiller Installed in Tajikistan Ministry of

By CAC Foreign Affairs

mized system design M idea Commercial Air Conditioning (CAC) has in- and enhanced heat stalled a water-cooled screw chiller in Tajikistan’s Ministry of exchange efficiency Foreign Affairs Building. Located in Dushanbe, the building has ensure the units work completed the installation, boasting a ca- seam- pacity of 1,480 kW. lessly Midea water-cooled screw chiller under operates with a flooded-type evaporator both and a high-efficiency compressor. Opti- full load and part load. Last year CAC’s water-cooled screw chiller was also installed in the office building of Tajiki- stan’s Prime Minister. Other locations at which the product has been installed by Midea CAC include the All Season Nusa Dua Resort Hotel in Indonesia; Mumbai Little World Shopping Mall; and Terminal 3 at Beijing Air- port.

German Certification

By Ma Songwu

training T he Association of German Electricians (VDE) certi- course on fied Midea’s Kitchen Appliances Division after completing the performance Test Data measure- Acceptance ment. Program Head- from July 18- quartered in 28. At the Frankfurt, same time, the VDE is VDE experts one of the Rainer Brenk largest technical and scientific associations in Europe with more and Thorsten than 36,000 members. This training and certification will greatly Rosenbaum aid the Kitchen Appliances Division’s future endeavors in Eu- carried out a rope.

5 Advances Fusion, July-August, 2016

NEWSLINE

IoT Relationship with Californian

By Kevin McGeary Network

M idea Group has selected the Ayla Networks Internet of Things (IoT) plat- form as its preferred overseas IoT cloud partner for all its connected HVAC products. Midea joins other top HVAC manufacturers in using Ayla services. ―The Ayla IoT platform now powers four of the top 10 HVAC manufacturers in Chi- na, which is powerful testimony to Ayla’s IoT leadership and grate all Midea technologies and products lines to become a market position,‖ said David Friedman, CEO and co-founder total solution provider for the smart home industry. of Ayla Networks. ―Midea is an enormously successful and Midea Smart Technology’s M-Smart System supports di- future-thinking enterprise, and we look forward to helping versified smart product inside the nearly 50-year-old Midea them become a dominant player in the global smart home Group. In addition, Midea Smart Technology is building an M- market.‖ Smart ecosystem that will provide smart products and solutions ―Midea Group laid out its concept for the smart home a to a wide range of business-to-business (B2B) and business-to- long time ago and has established Midea Smart Home Tech- consumer (B2C) enterprises. Already, Midea Smart Technolo- nology Co., Ltd., to focus on the development of that busi- gy’s ecosystem includes Ali Cloud, Amazon, , IBM, ness,‖ said Li Qiang, general manager of Midea Smart Tech- LeTV, TCL, and . nology. ―This cooperation with Ayla is a major step in the international expansion of Midea Group’s smart home busi- About Ayla ness. As Midea’s third-party cloud platform partner for over- seas markets, Ayla will join with Midea to create a globalized Ayla Networks empowers leading manufacturers by sim- structure of intelligent services for smart homes.‖ plifying the inherent complexity of the Internet of Things (IoT), Midea Group’s enabling them to turn their products into smart connected sys- relationship with tems and transform their businesses to compete in the game- Ayla Networks is changing world of connectivity. Delivered as a cloud platform- through its Midea as-a-service (PaaS), Ayla’s Agile IoT platform provides the flexi- Smart Technolo- bility and modularity to enable rapid changes to practically any gy business unit. type of device, cloud or app environment. Ayla Networks was Established in named a 2015 Cool Vendor in the Internet of Things by Gart- 2014 under the ner, Inc. Ayla’s investors include 3NOD, Acorn Pacific, Ants name of Midea Capital, Cisco, Crosslink Capital, the International Finance Cor- Smart Living poration, Linear Venture, Mitsui, SAIF Partners, SJF Ventures Lab, Midea Smart and Voyager Capital. Technology is For more information, visit www.aylanetworks.com working to inte-

6 Advances Fusion, July-August, 2016

NEWSLINE

Cooperation with Jordanian Princess

By Justin Li

supplying and servicing M idea welcomed four representatives of the Prin- in HVAC field in the cess of Jordan on July 25. The four students are here on a region market, where solar power project funded by the Princess Alia Foundation more than 700 VRF (PAF) after coming in the top three in a design competition projects installed with for buildings that use green energy sources. total capacity above Their trip to China took in both Huawei and Midea, 16000 RT. Working after Midea donated 10 solar-powered air conditioners to their closely with the PAF school. During their can help Midea further Jia Wei shows the princess around five-day visit, Midea its reputation in the Mid- gave them a varied and dle Eastern country. memorable trip, help- On May 23 Princess Alia visited Midea’s training college in ing them understand Jordan. Midea’s Regional Director Jia Wei showed her around more about the as representatives of the country’s major media organizations Group’s products and looked on. As a sign of its commitment to contributing posi- manufacturing process. tively to Jordanian society, Midea donated 20 Mission Split In- As soon as they arrived verters to a school that is funded by the PAF. This donation is a at the Group headquarters, they were immediately struck by sign of things to come. the building's unique design and the greenery and fishponds Due to the quality and reliability of its products, Midea that surround it. They were then shown around the product overcame competition showroom and history museum. from Japan, Korea, Midea’s technical support team then gave an introduc- Europe and North tion to the technology that the Group uses. This gave the America to land the students a lesson in how much work and skill are required to air conditioning pro- make air conditioners easy to use. ject for the Aqaba They were also shown around Midea’s factories in Shun- Saraya project. The de and Chancheng, near the global headquarters. The students project is a premier were then talked through some of Midea’s recent mergers and hospitality and leisure acquisitions, including the ones related to automated technol- destination built around a 1.5 kilometer lagoon. Saraya Aqaba ogy, which will form the future of manufacturing. In fluent includes a variety of luxurious residential units, World-class English, some of Midea’s intake of new graduates talked them hotels, signature retail shops, international restaurants, a Water through Midea’s vision for the future. Park, a beach club and an amphitheater, along with other leisure Digital AC Company (DAC) in Jordan represent Midea and business venues within an authentically styled ancient Ara- A/C products, bian city. DAC is owned The PAF was founded by H.R.H. Princess Alia Al Hus- by Al-Asalah sein and is a registered non-profit, non-governmental organiza- for Electrome- tion, under the Ministry of Social Development in the Hashe- chanics, which mite Kingdom of Jordan. Its aim is to promote compassion has more than and respect for all, using a holistic approach and bringing all 20 years of ex- stakeholders together to work as a united front. perience both

7 Advances Fusion, July-August, 2016

NEWSLINE Midea Climbs the Forbes 500

By Kevin McGeary

Last L ast year Midea Group entered the top 500 in The year was a for the first time. The criteria for the list challenging include sales, assets, profit and market value, and this year saw one for the Midea rise from 436th to 402nd. industry, In sales, the Group is 389th (up from 408th) and in profit with key it is 307th (up from 418th). It is again the highest ranked home markets appliances business on the list. encounter- ing politi- cal and economic instability. In spite of this, Midea Group’s profit saw a 21 percent increase year-on- year. The Forbes Global 2000 is a useful indicator of which are the leading public companies in the world. It has been pub- lished every year since 2003.

Workers Volunteer in Flood-Hit Areas

By MIB

of volun- M idea’s Residential Air Conditioning (RAC) factory teers with in truckloads Wuhu full of City packages in to nearby South flood-hit Chi- areas in na’s the first Anhui week of Prov- July. As ince millions sent were evacuated from their homes, the volunteers have helped teams the army deliver supplies to victims.

8 Advances Fusion, July-August, 2016

NEWSLINE

Toshiba, Midea Complete Transfer of Toshiba Appliances Business Press Release

diversified product offering, encompassing air-conditioners, M idea Group Co., Ltd. (SZSE: 000333, ―Midea‖) refrigerators, laundry appliances, kitchen appliances and various announced June 30 that they had completed the previously an- small home appliances. Midea is committed to build a better nounced transaction to acquire Toshiba’s Home Appliances life and become the world’s Midea by adhering to the principle Business. of ―Creating Value for Customers‖. Midea is focused on con- ―Today marks another important milestone in the strate- tinuous technological innovation to improve product and ser- gic partnership between Toshiba and Midea, which will bring vice quality, to make life more comfortable and pleasant. benefits to our customers, employees, suppliers and partners,‖ Founded in 1968 in Guangdong, China, Midea has now said Mr. Paul Fang, Chairman and President of Midea, ―We look established a global platform of more than 200 subsidiaries and forward to leveraging on our complementary resources and ca- 9 strategic business units. Midea had total revenues of over pabilities to fully realize the potential of the partnership. We US$21 billion in the fiscal year ended December 31, 2015 and believe our continu- approximately 100,000 ous investment in the employees worldwide. brand, technology, To find out more about marketing and people Midea, please visit and unwavering com- http:// mitment to product www.midea.com/ quality will enable us global to serve our custom- ers better and create About Toshiba more value for the society. To our home Toshiba Corporation, a appliance customers, Fortune Global 500 Toshiba brand will company, channels continue to be synon- world-class capabilities ymous with excel- in advanced electronic lence, reliability and and electrical product innovation.‖ and systems into three focus business fields: Energy that sus- As previously announced on March 30, 2016, Toshiba and tains everyday life, that is cleaner and safer; Infrastructure that Midea had entered into a Definitive Agreement (―DA‖) to trans- sustains quality of life; and Storage that sustains the advanced fer 80.1% stake in Toshiba Lifestyle Products & Services Corpo- information society. Guided by the principles of The Basic ration (―TLSC‖). As of June 30, 2016, all the condition prece- Commitment of the Toshiba Group, ―Committed to People, dents of the DA has been satisfied and the relevant regulatory Committed to the Future‖, Toshiba promotes global operations approvals have been obtained. The transaction price for the and is contributing to the realization of a world where genera- 80.1% stake was determined at JPY51.4 billion (c.US$500 mil- tions to come can live better lives. lion). Founded in Tokyo in 1875, today’s Toshiba is at the heart of a global network of over 580 consolidated companies em- About Midea ploying 199,000 people worldwide, with annual sales surpassing 6.6 trillion yen (US$55 billion). (As of March 31, 2015.) Midea is a global leading consumer appliances and heating, To find out more about Toshiba, visit www.toshiba.co.jp/ ventilation and air-conditioning (HVAC) systems business, with index.htm

9 Advances Fusion, July-August, 2016

NEWSLINE 2 Products Named Best of the Best in

By MIB Germany

culate from the weight of the clothes how much detergent is E veryone who was anyone in international design was needed. With its transparent top loading lid, it is particularly in Essen, Germany on July 4 for the Red Dot Awards. In spring, friendly to the elderly consumer. a 41-strong jury awarded the coveted Red Dot label for good design to the most outstanding products of the year. Now it was Hybrid Air Conditioner time to pay tribute to the winning creations and the people who made them. The Hybrid Air Conditioner, designed in collaboration At the red carpet gala, a Midea-brand air conditioner and a with Phoenix Design GmbH & Co. KG, has a built-in air puri- washing machine from subsidiary Little Swan were presented fying feature, with Best of the Best awards. Other particularly use- companies to win the award included ful in polluted Ikea, Airbus, Ferrari, Sony, and Mi- modern cities. crosoft. Along with its stylish design, it Little Swan Beverly 7188 Series boasts a self- Washing Machines cleaning func- tion. With ultraviolet light and integrated brush, the filter can Manufactured in South China’s Jiang- automatically clean and disinfect. When the device is in self- su Province, Little Swan’s Beverly cleaning mode, the signal light will illuminate through the perfo- 7188 has a smart sensor that can cal- rated plastic panel.

Profit up 14% Year-on-Year

By Midea

Chinese homes with smart appliances I n the first half of and introduce more automated tech- 2016, Midea Group nology in factories. It has also made achieved revenue of major acquisitions in Germany, Italy US$11.7 billion, according and Japan that will help it expand. to the Group’s H1 report. Consolidated gross margin in the first Net income for the six half was 29.2%, up 1.8 percentage months ending June was points. Net profit margin was 13.2%, US$1.5 billion, a year-on- up 2.4 percentage points. year increase of 14 per- The first six months were a doubly cent. fruitful period for the Group’s ―twin During this period, smart‖ approach of becoming a lead- Midea successfully com- er in Internet of Things ―smart peted to outfit millions of home‖ technology and automated manufacturing.

10 Advances Fusion, July-August, 2016

NEWSLINE

Brand Merges with Springer in Brazil

By Nadia Mathias

A meeting was held August 23 to announce a mer- ger of the Midea and Springer brands in São Paulo , Brazil. Executives, clients and media were present as Midea displayed a range of new products it will promote in the South Ameri- can country, including electric pans, fryers and vacuum clean- ers. With its increased white goods portfolio, executives

zilian traditions of Springer while adopting the Chinese leader- ship and innovation of Midea. It will introduce new air condi- tioning products and evaporative coolers to the market.

expect Midea to be among the biggest players in Brazil’s home appliances industry over the next five years. According to feedback from the 239 people present, the event – sponsored by Midea Residential Air Conditioning (RAC) - was a big suc- cess. Subsidiary brand Springer Midea will combine the Bra-

It is part of the expansion plan adopted by the company and also includes a 51 percent increase of products in the white line portfolio. The new launches were presented to clients at the event. ―We realized that for the domestic market, it would be more interesting to have a competitive advantage focused on consumer needs. So, we decided to combine the tradition of the brand Springer to Midea’s leadership and innovation in the de-

11 Advances Fusion, July-August, 2016

NEWSLINE Brand Merges with Springer in Brazil (Cont.)

By Nadia Mathias

velopment of residential air-conditioning products‖, explained Felipe Costa, Midea Carrier’s CEO in Brazil.

Feature in Brazil’s Largest Finance Paper

By Nadia Mathias

ee. B razil’s largest news- According to the article, paper for economics, finance the company plans to tri- and business, Valor Econômico, ple in size in Brazil in the published an article about next five years, reaching Midea’s growth strategy in the R$ 4 billion (US$1.2 bil- country. Midea’s future direc- lion) in net revenue by tion and the brand merger of 2020. This would place it Springer and Midea in air condi- in the top three in the in- tioning were among the themes dustry. Strategies include a discussed by the newspaper in 50 percent expansion in the article that featured Felipe the product line, adding Costa, the CEO of Midea- electric pans, fryers and Carrier in Brazil, as an interview- Felipe Costa vacuum cleaners to the range.

12 Advances Fusion, July-August, 2016

KUKA

Midea Announces Results of Kuka Takeover

Press Release

 Following the close of the acceptance period, 72.18% Complete terms and conditions of the takeover offer can percent of KUKA shares were tendered be found in the German offer document published on the web-  Minimum acceptance threshold of 30% and other non- site www.partnershipinrobotics.com. An English convenience regulatory conditions were satisfied translation of the German offer document is also available on  Additional two-week acceptance period will begin on the website. July 21, 2016 and will expire on August 3, 2016 IMPORTANT INFORMATION FOR INVESTORS Guangdong, China, 20 July 2016 – Midea (Midea Group AND SHAREHOLDERS Co Ltd, SZSE 000333), one of the world’s leading industrial groups in consumer appliances and Heating, Ventilation and Air Additional information -Conditioning (HVAC) systems, announced today, following the close of the acceptance period, the results of the acceptances of Midea has the financial capacity needed to implement the the voluntary public takeover offer made by its subsidiary MEC- transaction. The transaction is financed via a credit facility. CA International (BVI) Limited for all shares of KUKA AG Morgan Stanley is acting as exclusive financial advisor and (KUKA), a leading global supplier of intelligent automation so- Freshfields Bruckhaus Deringer is acting as legal advisor to lutions. 72.18% of KUKA shares were tendered as of July 15, Midea on the transaction. 2016. This announcement does not constitute an offer or an Paul Fang, Chairman and CEO of Midea, commented: invitation to purchase any securities. The takeover offer is ―Today we have reached an important milestone in expanding made solely by means of the offer document, which contains our partnership with KUKA to deliver greater value for both the full terms and conditions of the takeover offer including companies. The investment agreement between KUKA and details of how it may be accepted. Midea governs the partnership between both companies. We This document may contain certain forward-looking state- want to help grow KUKA’s business and increase its footprint, ments. Such statements are, in particular, indicated by terms especially in China.‖ such as "expects", "believes", "is of the opinion", "attempts", The total number of KUKA shares for which the takeover "estimates", "intends", "assumes" and "endeavors" and similar offer has been accepted during the offer period plus the 13.51% phrases. Such statements express current intentions, views, ex- KUKA shares indirectly held by Midea prior to the takeover pectations, estimates and forecasts with regard to possible fu- offer, result in 85.69% of the issued share capital and the exist- ture events. They are, inter alia, based on certain assumptions, ing voting rights of KUKA. The minimum acceptance threshold assessments and forecasts, are subject to risks and uncertainties of 30% has therefore been satisfied. The other non-regulatory and therefore they may turn out to be incorrect. conditions of the takeover offer are satisfied as of the end of the acceptance period. The offer remains subject to regulatory ap- Notice to US holders of KUKA AG Shares provals. According to the German Securities Acquisition and Take- The takeover offer is being made for the securities of a over Act (WpÜG), shareholders of KUKA AG who have not German company and is subject to German disclosure require- tendered their shares can still accept the offer by tendering their ments, which are different from those of the United States. The shares during the additional two-week acceptance period, which financial information included in this announcement has been will begin on July 21, 2016 and end on August 3, 2016 at 24:00 largely prepared in accordance with International Financial Re- hours (local time Frankfurt am Main). Midea will disclose the porting Standards and the generally accepted accounting princi- final figure of shares tendered following the expiration of the ples of the PRC and thus may not be comparable to financial additional acceptance period. information of US companies or companies whose financial

13 Advances Fusion, July-August, 2016

KUKA

Midea Announces Results of Kuka Takeover

Press Release statements are prepared in accordance with generally accepted purchase is made public in Germany, such information also will accounting principles in the United States. The takeover offer is be deemed to be publicly disclosed in the United States. In addi- made in the United States pursuant to the applicable US tender tion, the financial advisors to the Bidder may also engage in offer rules, including Regulation 14E and relevant provisions on ordinary course trading activities in securities of KUKA AG, exemptions from the prohibition on purchases outside the take- which may include purchases or arrangements to purchase such over offer and otherwise in accordance with the requirements of securities. the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz). Accordingly, the About Midea takeover offer will be subject to disclosure and other procedural requirements, including with respect to withdrawal rights, offer Midea is a leading global player in consumer appliances timetable, settlement procedures and timing of payments that and Heating, Ventilation and Air-Conditioning (HVAC) sys- are different from those applicable under domestic US tender tems, with diversified product offering, encompassing air- offer proce- conditioners, refrigerators, dures and laundry appliances, kitchen law. appliances and various small To the home appliances. Midea is extent per- committed to build a better missible un- life by adhering to the princi- der applica- ple of ―Creating Value for ble law or Customers‖. Midea is focused regulation, on continuous technological MECCA innovation, including robot- International ics, to improve product and (BVI) Lim- service quality, to make life ited (the more comfortable and pleas- Bidder) and ant. its affiliates Founded in 1968 in Guang- or brokers dong, China, Midea has now (acting as agents for the Bidder or its affiliates, as applicable) established a global platform of more than 200 subsidiaries and may from time to time before, during or after the period in nine strategic business units. Midea had total revenues of over which the takeover offer remains open for acceptance, and other EUR 18.7 billion in the fiscal year ending December 31, 2015 than pursuant to the takeover offer, directly or indirectly pur- and approximately 100,000 employees worldwide. Midea runs chase, or arrange to purchase, shares of KUKA AG, that may be 21 manufacturing sites globally and operates 260 logistics cen- the subject of the takeover offer, or any securities that are con- tres. Midea is a private company listed on the Shenzhen Stock vertible into, exchangeable for or exercisable for shares of KU- Exchange (000333). Midea has a diversified investor base with KA AG. Any such purchases, or arrangements to purchase, will approximately 20 percent of shares held by international institu- comply with all applicable German rules and regulations and tional investors. Rule 14e-5 under the U.S. Securities Exchange Act to the extent To learn more about Midea, please visit http:// applicable. Information about such purchases will be disclosed www.midea.com/global/ in Germany to the extent required by applicable law. To the For the tender offer document please visit http:// extent information about such purchases or arrangements to www.partnershipinrobotics.com/

14 Advances Fusion, July-August, 2016

FUSION Land of Caves and Ancient Trade Routes

By Kevin McGeary

S ince a local subsidiary was established in 2006, Malay- The native tribes of East Malaysia have their own lan- sia has become one of Midea’s most important markets. Midea guages which are related to, but easily distinguishable from, Scott & English has provided Malaysian consumers with mod- Malay. English was the predominant language in government ern, high quality products. Supported by sales & service centers until 1969, and is still a pillar of the education system. throughout the country, the company’s philosophy is to ensure customer satisfaction with quality products that are accessible Ancient history to all Malaysian consumers. Malaysia is the third largest economy in Southeast Asia in The Lembah Bujang Archaeological Museum is the only gross domestic product behind Indonesia and Thailand, and museum in Malaysia which exhibits archaeological collections the third largest in per capita gross domestic product behind that serves as evidence of the existence of a trade and Hindu/ Singapore and Brunei. Here are some things you may not have Buddhism propagation center in Southeast Asia from the third known about the country. to the twelfth centuries AD. It has archaeological evidence that clearly shows that Malaysia’s Bujang Val- ley was a central port which served as a trade center be- tween Chi- Language nese, Indian Lembah Bujang and Arab trad- Malaysia contains speakers of 137 living languages, 41 of ers. which are found in Peninsula Malaysia. The government pro- Lembah Bujang was also the first port in southeast Asia vides schooling at the primary level in each of the three major via its sea route which functioned as an alternative route to the languages, Malay, Mandarin and Tamil. Far East to rival the silk road. Lembah Bujang’s significance as The national, or official, language is Malay which is the Southeast Asia’s central port was evident in archaeological mother tongue of finds and writings of Chinese and Arab seamen as well as in the majority Ma- Indian literature. These chronicles, dated between the 2nd and lay ethnic group. 14th century AD, told of the existence of a prosperous and Malay became bustling kingdom in Lembah Bujang that was known as the predominant after "seat of all felicities". the 1969 race riots. A variant of Founding the Malay lan- guage that is spo- It was born as a ken in Brunei is modern nation also commonly state in 1957 spoken in East when the Brit- Malaysia.

15 Advances Fusion, July-August, 2016

FUSION Land of Caves and Ancient Trade Routes (Cont.) By Kevin McGeary ish surrendered their sovereignty over Malaysia and the penin- sula became independent with the name 'Federation of Malay- sia'. The new federation was established on September 16th, Cuisine 1963 by the unity of Malaysia, Singapore and the east-Malaysian states Sabah and Sarawak on the north coast of Borneo. Malaysia's Directly after this, The Philippines and Indonesia broke culinary diplomatic relations, because they believed that some parts be- style in the longed to them. Indonesia started with the konfrontasi present (confrontation); fishing-boats in front of Sarawak's coast were day is pri- sunk and their planes entered Sabah airspace. But after the de- marily a posal of Indonesian President Sukarno in 1966, the government melange made a treaty of peace with Malaysia and The Philippines of tradi- dropped its territorial claim on Sabah. tions from In 1965 Singapore separated from the federation and Nasi lemak its Malay, became an independent state. The sultan of the oil state Brunei Chinese, Indian, Indonesian and ethnic Bornean citizens, with (located between Sabah and Sarawak), made clear that he op- heavy to light influences from Thai, Portuguese, Dutch, and posed unity with Malaysia. British cuisines.

The national dish is widely said to be nasi lemak, rice Caves steamed with coconut milk and pandan leaves. It is customari-

ly served with ikan bilis, peanuts, sliced cucumber, hard boiled Among eggs and sambal. Other popular dishes include congee, a type the most of rice porridge, eaten primarily as a breakfast or late supper. It famous is also considered suitable for the sick as a mild, easily digesti- caves in ble food. the world A practice known as "open house‖ is popular on festive are those occasions. Home-cooked or catered food is provided by the in Gunung host at their own expense, and while it is acceptable for guests Mulu Na- Gunung Mulu to bring along gifts, they are ex- tional Park, pected to help themselves to the Sarawak, which was inscribed as a World Heritage site in 2001. food. Open house events may also More than 362 km of cave passage have been mapped there. be held at restaurants and larger pub- Some of its caves are world record holders, such as Gua Nasib lic venues, especially when hosted by Bagus, which houses Sarawak Chamber, the world’s largest. government agencies or corpora- Clearwater Cave is the eighth longest in the world, at 215 km. tions. Deer Cave is one of the world's largest cave passages. Niah

Caves, also in Sarawak, is a famous archaeological site. A Fashion and Attire 40,000 year old human skull was found there and rock paint- ings have been dated at 1200 years old. Baju is the term for clothing in Perak Tong Cave Temple is located just north of Ipoh the Malay language. Since Malaysia and is one of the oldest temples and famous for the murals. comprises three major cultures, each The walls of the cavern are decorated with colorful murals de- culture has its own traditional and picting characters and events from Chinese mythology and religious articles of clothing all of Buddhist scriptures. Baju Kurung Kedah

16 Advances Fusion, July-August, 2016

FUSION Land of Caves and Ancient Trade Routes (Cont.) By Kevin McGeary which are gender-specific and may be adapted to local influ- ences and conditions. KRU is the most successful hip hop dance group in Malaysia. Baju Kurung Kedah – worn only by Malay women as a After bringing Rap music to the masses in 1992, they estab- daily dress for married women. It is a shorter dress with three- lished their own record label which spawned the first Malaysi- quarter sleeves, so the wearer can move around. an girl group Feminin and R&B crooners Indigo. Feminin Baju Batik – worn by men and women on formal occa- debuted at RTM Eid ul-Fitr special in 1993 marking the start sions. It usually consists of colorful cotton printed in the of Malaysia’s girl group era. ―batik‖, that is cloth made from wax-resist dyeing. Contemporary pop music exchanges between Malaysia, Baju Kurung – worn by women for formal occasions Indonesia, Singapore and Brunei are normal since the Malay like school or weddings. It language is widely spoken in all of those countries. Pop singer is brightly colored and can Siti Nurhaliza for come in a variety of print- example is famous ed designs. It is a knee- in all four. length dress with full- Yuna, an inde- length sleeves. pendent Malaysian On the more mod- singer-songwriter, ern end of the scale, Ma- had her 2012 single laysia’s greatest fashion ―Live Your Life‖ icon is Jimmy Choo (周仰 produced by Phar- 杰), who received pat- rell Williams. She ronage from Diana, Prin- was subsequently cess of Wales. Jimmy Choo recognized with a National Youth Music Icon Award by Prime Minister Da- Both Malaysian popular tuk Seri Najib Razak. music and contempo- rary art music are essen- Sport tially Western-based traditions combined The national with local elements. In sport of Ma- 1950s, P. Ramlee (1929- laysia is Sepak 1973) helped create a Takraw. It is a Malaysian form that sport in which combined folks songs the players with Western dance must kick a rhythms and styles of takraw (hollow both the pre-colonial ball made out period and the period of rattan or during which Portugal woven palm colonized the region stems) over a (1511-1641). Sepak Takraw net. It is similar P. Ramlee In contemporary genres,

17 Advances Fusion, July-August, 2016

FUSION Land of Caves and Ancient Trade Routes (Cont.) By Kevin McGeary to volleyball or badminton except players cannot use their hands. Islam was introduced by traders arriving from Arabia, In terms of international competition, Nicol David is a China and India. It became firmly established in the 15th cen- Malaysian professional squash player who, starting in August tury. The constitution makes Malaysia a secular country and 2006, was the world number one for a record 108 consecutive guarantees freedom of religion, while establishing Islam as the months. She "religion of the Federation" to symbolize its importance to has won the Malaysian society. World Open Relations between different religious groups are generally title a record tolerant. Christmas, Chinese New Year, and Deepavali have 8 times. Con- been declared national holidays alongside Islamic holidays sidered by such as Muham- some to be mad's birthday. the greatest

women's Famous peo- squash player Nicol David ple of all time, she is perhaps Malaysia’s best loved sports star. Perhaps the Badminton player Lee Chongwei was ranked No. 1 in the most famous living world from just after the Beijing Olympics in 2008 to just be- Malaysian is the 34 fore the London Olympics in 2012, though he finished runner- year-old model, up in both to Chinese rival Lin Dan. In Rio this year, he over- actress, TV host came Lin in a nail-biting semi-final, only to lose the final and and brand ambassa- miss out on becoming Malaysia’s first ever Olympic gold med- dor Amber Chia alist. 谢丽萍). ( Winner Religion of the Guess Watches Timeless Malaysia is a multicultural and multi-confessional country. Beauty Internation- As of the 2010 Population and Housing Census, 61.3 percent al Model Search of the population practices Islam; 19.8 percent Buddhism; 9.2 2004 title, Amber percent Christianity; 6.3 percent Hinduism; and 1.3 percent has appeared in traditional Chinese religions. over 300 magazine Amber Chia covers, catwalk on runways in 6 conti- nents, starred in 7 movies, authored 2 books, and appointed ambassador for over 30 brands. Actress Tan Sri Michelle Yeoh is known for her roles in the 1997 James Bond film Tomorrow Never Dies and martial arts film ―Crouching Tiger, Hidden Dragon”. In 2008, she was ranked the greatest action heroine of all time by the film criti- cism website Rotten Tomatoes. She was listed by People maga- zine (the only Asian actress to be listed) as one of the ―35 All- Time Screen Beauties‖ in 2009.

18 Advances Fusion, July-August, 2016

FUSION From Stravinsky to Solzhenitsyn

By Kevin McGeary

through the woodlands of Eastern Europe. These tribes who shared a common Slavic language had by the 7th century split into western, southern and eastern branches, the latter stretching from the Dniester River to the Volga and the Baltic Sea. Under Viking rule, a capital was established in Kiev. The new princedom was named Rus, most likely derived from a Nordic word meaning ―men who row‖. Though the princedom thrived due to rich resources and strong trade partnerships, the decline of Constantinople, hit its economy severely. In 1237, 35,000 mounted archers led by Batu Khan sacked the princedom’s cities before moving further west. A July saw Midea open its first brand store in Moscow, remote trading post known as Moscow would gradually grow following on from last year when Midea was an official sponsor to challenge Mongol power, conquering and absorbing of the FINA Games which were held in the Russian city of territories of its fragmenting empire to the East. Kazan. Midea’s brand recognition and revenue are both expected to grow significantly in Russia over the coming years. Cyrillic As an economy, Russia has seen a resurgence in the early

21st century after a 1990s slump. Here are some things you The Cyrillic alphabet owes its name to the 9th century may not have known about the world’s largest nation. Byzantine missionary St. Cyril, who, along with his brother,

Methodius, created the first Slavic alphabet—the Glagolitic— How did Russia become so big? in order to translate Greek religious text to Slavic. Based on

the Greek ceremonial script, the original Cyrillic alphabet In the first millennium AD, a large group of tribes spread included the 24 letters of the Greek alphabet and 19 letters for sounds specific to the Slavic language.

The very existence of the Cyrillic alphabet in Russia was once under threat. In 1919 there was an idea to replace it with the Latin one and bring it into harmony with the alphabet used in Western countries. That could have made the process of learning Russian much easier for some, but this was not to be and we can still enjoy the masterpieces of Russian literature in

A map of Russia from 924

19 Advances Fusion, July-August, 2016

FUSION From Stravinsky to Solzhenitsyn (Cont.)

By Kevin McGeary their original script. As of 2011, around 252 million people in Eurasia use it as masterpieces of the Soviet era. the official alphabet for their national languages, with Russia accounting for about half of them. With the accession of Composers Bulgaria to the European Union on January 1, 2007, Cyrillic became the third official script of the European Union, Russia is a major contributor to Western Art Music. The following the Latin and Greek scripts. Mighty Handful was a group of prominent 19th century

composers active in Saint Petersburg who strived to produce a Authors specifically Russian kind of classical music. The group met

from 1856 to 1870 and consisted of Mily Balakirev (the The most celebrated leader), César Cui, Modest Mussorgsky, Nikolai Rimsky- period of the Russian novel Korsakov and Alexander Borodin. was the 19th century, which Around the same time, Pyotr Ilyich Tchaikovsky created produced some of the a body of work that placed him as arguably the most popular undisputed masterworks of ―classical‖ composer of all time. His best known works world literature. Russian include the ballets ―Romeo & Juliet‖ and ―Swan Lake‖. classics are defined by More recently, Igor Stravinsky’s ―The Rite of Spring‖, formal innovation and which premiered to riots in Paris in 1913, is one of the seminal philosophical exploration. works of the modernist era. The piece would go on to leave an The Russian language indelible mark on jazz, minimalism, and other contemporary has given the world nineteenth century novelists Leo Tolstoy (War & Peace, Leo Tolstoy Anna Karenina) and Fyodor Dostoevsky (Crime & Punishment, The Brothers Karamazov) to masters of the short story such as Anton Chekhov and Nikolai Gogol. Some of Chekhov’s great quotes include ―Any idiot can face a crisis - it's day to day living that wears you out‖; and ―If you are afraid of loneliness, don’t marry.‖ In the twentieth and twenty- Igor Stravinsky first centuries, Russian authors Boris Pasternak, movements. His contemporary Dmitri Shostakovich was also Mikhail Sholokhov, among the most innovative musicians of the time. Aleksandr Solzhenitsyn,

Joseph Brodsky, Svetlana Space exploration Alexievich have won the

Nobel Prize for Literature. The Soviet space program comprised the rocketry and Pasternak’s Dr. Zhivago and space exploration programs conducted by the former Soviet Solzhenitsyn’s Gulag Boris Pasternak Union from the 1930s until 1991. Over its sixty-year history, it Archipelago are among the great

20 Advances Fusion, July-August, 2016

FUSION From Stravinsky to Solzhenitsyn (Cont.)

By Kevin McGeary was responsible for a number of pioneering established in Kievan Rus. The great churches of Kievan Rus', accomplishments in built after the adoption of Christianity in 988, were the first space flight, including examples of monumental architecture in the East Slavic the first intercontinental region. The architectural style of the Kievan state, which ballistic missile, first quickly established itself, was strongly influenced by Byzantine satellite, first animal in architecture. Early Eastern Orthodox churches were mainly Earth orbit, first human built from wood, with their simplest form known as a cell in space, first woman in church. Major cathedrals often featured many small domes, space, first spacewalk, which has led some art historians to infer how the pagan Slavic first Moon impact, first temples may have appeared. image of the far side of Throughout the Muscovite periods and the imperial the moon and unmanned period, Russian architecture adopted more influence from lunar soft landing, first Mongolia, the Middle East and the Netherlands. Today its space rover, first sample most iconic buildings include Saint Basil’s Cathedral in Red of lunar soil, and first Yuri Gagarin, the first person in Square, the Kremlin, Catherine Palace in St. Petersburg and space station. space The Winter Palace, in which Midea has installed its In the 1990s, Russian commercial air conditioning. space exploration was in a rut, but today Roscosmos, the governmental body responsible for the space science program Cuisine of Russia and general aerospace research, is overseeing something of a renaissance, including a number of research and Russian cuisine derives its varied character from the vast aerospace programs. and multi-cultural

expanse of Russia. Its Architecture foundations were laid

by the peasant food of Russian architecture follows a tradition whose roots were the rural population in an often harsh climate, rich local resources provided the ingredients for a Kotlety plethora of breads, pancakes, pies, cereals, beer and vodka. Popular Russian dishes include Rassolnik, a hot soup in a salty-sour cucumber base; Pelmeni, minced meat wrapped in dough; and Kotlety, small pan-fried meatballs similar to Salisbury steak.

Sport

Since the Olympic Games in Helsinki in 1952, Russia has The Winter Palace, which contains Midea air conditioning been in the top four in the medal table at every Summer

21 Advances Fusion, July-August, 2016

FUSION From Stravinsky to Solzhenitsyn (Cont.)

By Kevin McGeary Olympics. It was top two in most. According to Yandex search analysis: "Football topped the list of the most popular sports in occasions. Russia". Ice hockey came in second with basketball, boxing, auto racing, volleyball, athletics, tennis and chess rounding out Banya the top ten. Other popular sports include bandy, biathlon, figure skating, handball, weightlifting, gymnastics, wrestling, Banya, a Russian type of sauna, a kind of steam bath, is martial arts, rugby union, one of the oldest Russian traditions. It is a popular form of and skiing. relaxation and bonding. In football The Soviet A Russian banya has a special room, where a large Union won the inaugural amount of hot steam is created with the help of water and hot European Championship in air. Inside the banya, which is usually built of wood, there are 1960, beating Yugoslavia 2- wide wooden benches along the walls. They are built one 1 in the Paris final. Their above the other like steps. The higher up the bench the hotter number one that day was the air. Once someone has warmed up well enough, he or she Lev Yashin, nicknamed the leaves the steam room and dips into a pool of cold water. "Black Spider", who is

widely believed to be the Wildlife greatest goalkeeper in the

history of the game. Russia contains the planet's largest expanse of forest, Lev Yashin According to FIFA, Yashin over eight million square kilometers of mixed woodlands that saved over 150 penalty kicks are home in professional football – more than any other goalkeeper. to rare Russia’s men’s ice hockey team won gold at the world carnivores championships on five occasions between 1993 and 2014. One including of Russia’s greatest hockey players was Sergei Fyodorov. He tigers, played in the National Hockey League (NHL) for the Detroit bears and Red Wings, with whom he won the Stanley Cup on three leopards. According to the Red Data Book of Siberian tiger the Russian Federation, as of 1997, the country had 266 mammal species and 780 bird species under protection. In the Russian Far East the mammals reportedly spotted include brown bears, Eurasian lynx, and red deer, Amur tigers, Amur leopards, and Asiatic black bears. There are also about 350 bird species and 30 percent of all endangered species in Russia are found there which include 48 unique endangered species.

Banya

22 Advances Fusion, July-August, 2016

SNAPSHOT

Brand Merger Celebrated in Brazil

23