Friday, December, 02, 2022 10:02:50
Inverter manufacturer giant FIMER to buy ABB’s solar inverter business
The acquisition includes Power One, the solar inverter business acquired by ABB’s Discrete Automation and Motion division in 2013.
ABB - the Switzerland based multinational corporation has reportedly declared to have signed an agreement with FIMER that entails the latter to acquire ABB’s solar inverter business. The acquisition aims at enhancing the solar inverter business in the future and will allow ABB to focus on its business portfolio in the other industry segments.
Reportedly, ABB’s solar invertor business comprises approximately 800 employees spread over 30 countries. The R&D and manufacturing units are located in Finland, Italy and India. The business comprises of a comprehensive portfolio of systems, products and services for various solar installations.
Tarak Mehta, President of ABB’s electrification unit was reportedly quoted stating that the disinvestment is in lieu of the systematic portfolio management to strengthen the quality of revenue, competitiveness and focus on higher growth segments. Additionally, the acquisition by FIMER will enhance the sales growth and emerge as the pioneers in the solar inverter market segment. Through ABB’s low and medium voltage offering, ABB will continue to integrate solar power into smart solution projects pertaining to energy storage, electric vehicle charging and smart buildings, he further claimed.
According to industry experts, FIMER will honor all the warranties while ABB will compensate FIMER for acquiring the business and covering the liabilities. Apparently, ABB is to pay USD 430 million in the second quarter of 2019 as an after-tax non-operational charge fee. 75% of this charge is represented by cash outflow payable to FIMER from the deal closing date through 2025. Additionally, ABB may incur $40 million as a separation cost in the second half of 2019.
Citing reports, after the completion of the transaction, the EBITA margin for electrification business may be positively impacted by more than 50 basis points, supporting the businesses progress towards the targeted margin corridor of 15-19%.
As per trusted sources, the transaction is expected to complete in the first quarter of 2020 subjected to certain conditions.
Source Credits : https://new.abb.com/news/detail/26838/abb-to-exit-solar-inverter-business