Hitachi has announced that it has completed the procedures for its 80.1% investment in the company operating power grids business that had been carved out from ABB Ltd, pursuant to the acquisition agreement signed on December 17, 2018.
The new company, Hitachi ABB Power Grids Ltd was launched and began operation on Wednesday.
According to Hitachi, under the leadership of Claudio Facchin, CEO, and Toshikazu Nishino, Executive Vice President of Hitachi, as Chairman, Hitachi ABB Power Grids will expand Hitachi’s energy solutions business globally as a core part of the company’s Social Innovation Business.
By combining world-class power grids business with Hitachi’s advanced digital technologies such as Lumada, Hitachi and Hitachi ABB Power Grids will provide innovative energy solutions spanning the Energy (utilities), Mobility, Smart Life (cities), Industry,and ITsectors.
With roots in Hitachi and ABB, the new business will build on more than one century of expertise in pioneering engineering technologies, enabling customers to increase efficiency and maintaining resilience. It will unlock new business models and contribute social, environmental and economic values for a sustainable society.
The world’s energy markets are going through an unprecedented transformation needed to realize the energy transition. The need for innovative energy solutions is being driven by short-and long-term global trends. The share of renewables in the energy mix is increasing significantly and will play a key role in achieving the ambitious decarbonization targets set by countries around the world.
Intermittent by nature, renewable energy sources have resulted in increased complexity; while many countries have made great strides in the adoption of renewables, they now need to manage a more dynamic system, requiring increased flexibility and resilience to achieve a sustainable outcome. Many more interconnections will be required to maximize the penetration of renewables in the energy market.
The rapid rise in distributed power generation and changes in consumption patterns (for example, the emergence of prosumers) are parts of this changing energy landscape. Furthermore, the growth of electric vehicles and expansion of the world’s data centers has ramped up electricity demand.
Markets related to digital utilities, such as predictive maintenance, distributed power supply and asset optimization are expected to grow strongly. The demand for electricity continues to outpace the rising need for energy; the challenge is to meet this growing demand while minimizing environmental impact fora sustainable energy future.
The new joint venture and its 36,000 employees remain committed to be the partner of choice for stronger, smarter and greener power grids. Underpinned by a customer-focused mindset and a world-class R&D organization of around 2,000 experts, the company will continue to differentiate itself through customer service, domain expertise, technology and innovation, an unparalleled global footprint and an installed base.
The purchase price of Hitachi ABB Power Grids’ 80.1% stake is approx. US$ 6.85billion.
Hitachi will consider to acquire the remaining 19.9% stake of Hitachi ABB Power Grids – making it a wholly owned subsidiary –after 2023.
See company’s press release HERE