ABB sells $1.68 billion Hitachi Energy stake back to Hitachi
September 30, 2022 at 12:04 pm IST
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ZURICH (Reuters) - ABB will sell back to Hitachi its remaining 19.9% stake, worth $1.679 billion, in the Hitachi Energy joint venture, the Swiss engineering group said on Friday.
Hitachi exercised its option to buy the stake in the venture formed from ABB's Power Grids business in 2020.
"ABB does not expect to record any significant gain or loss as a result of the sale. ABB expects net positive cash inflows of approximately $1.425 billion upon closing of the sale," which is set to close before the end of the year, pending regulatory approvals, it said in a statement.
"We are delighted to have agreed on the final part of the transaction earlier than expected and on favorable terms. This will further strengthen our balance sheet and give us additional flexibility in our capital allocation decisions," ABB finance chief Timo Ihamuotila said.
(Reporting by Michael Shields; Editing by Mark Potter)
Hitachi specializes in manufacturing and marketing of electronic and industrial equipments. Net sales (including intragroup) break down by family of products and services as follows:
- social infrastructure and industrial systems (24.7%): elevators, escalators, industrial facilities, railway systems, power generation units, etc. The group also provides engineering and construction of nuclear, hydroelectric, and thermal power plants services;
- information and telecommunications products and services (20.1%): systems integration, cloud computing, software, servers, hard disks, PCs, ATMs, data communication base stations, payment terminals, etc.;
- materials and components (16.6%): semi-conductor materials, printed circuit cards, cables, copper and forged steel products, magnetic materials, organic and inorganic chemical products, etc.;
- construction equipment (10%) : hydraulic excavators, wheel loaders, mining equipment, etc.;
- automotive systems (9.4%): powertrain systems, control systems, etc.;
- electronic products (9.2%): fiber-optic components, screen tubes, testing and measurement equipment, medical equipment, equipment for manufacturing semiconductors, etc.;
- household appliances (4.7%): heating and air conditioning equipments, refrigerators, washing machines, etc.;
- other (5.3%): mainly transport, financial and logistical services.
Net sales are distributed geographically as follows: Japan (49.2%), Asia (21.3%), North America (12.7%), Europe (10.8%) and other (6%).