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ABB to divest its stake in Hitachi Energy to Hitachi

  • 11 months ago (2022-10-03)
  • David Flin
Asia 806 Distribution 95 Europe 1023

ABB will sell its remaining 19.9 per cent stake in the Hitachi Energy joint venture to Hitachi . Hitachi Energy was a joint venture company formed from ABB’s Power Grids business in 2020.

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By exercising its call option, Hitachi will now acquire the stake held by ABB. The call option was agreed between the two companies in December 2018 and is valued at around $1.68 billion.

ABB has also agreed to provide transition services to Hitachi Energy to help it fully separate from ABB’s systems. The deal is expected to close in the fourth quarter of this year, subject to receiving regulatory approvals. Once it has closed, ABB expects a net positive cash inflow of nearly $1.425 billion.

Timo Ihamuotila, CFO for ABB, said: “We are delighted to have agreed on the final part of the transaction earlier than expected and on favourable terms. This will further strengthen our balance sheet and give us additional flexibility in our capital allocation decisions.”