Tokyo, Japan, December 17, 2018 – Hitachi, Ltd. (TSE:6501, “Hitachi”) today announced that it has decided to acquire the world-leading power grids business from ABB Ltd (NYSE:ABB, “ABB Ltd”) and has signed an agreement with ABB. Hitachi plans to initially acquire an 80.1% stake in the Power Grids business and expects to close the acquisition in the first half of 2020, making Power Grids a consolidated subsidiary. Hitachi has entered into a purchase option to acquire the remaining 19.9% stake in Power Grids, making Power Grids a wholly-owned subsidiary.
As a result of this agreement, Hitachi will offer innovative energy solutions globally by combining ABB’s world-class grids offering including advanced digital grid solutions with Hitachi’s digital technology. In addition, Hitachi aims to build an energy platform that connects various fields such as mobility, life and industry. Hitachi will expand provision of the platform to, and collaborative creation using it with ABB Ltd’s broad range of customers to promote more efficient use of electricity throughout society and empower and grow the Social Innovation Business.
The power grids market is rapidly expanding driven by increasing adoption of renewable energy, rising energy demand and supply in emerging countries, the expansion of distributed power sources such as electric vehicles and storage batteries, deregulation of the electric power sector in countries and regions, and advances in electric power system reform. The market is forecasted to reach more than US$100 billion (approx. JPY11 trillion)*1 by 2020, at a steady annual growth rate of 4% or above for the period from 2017 to 2020*1. In particular, advanced energy management systems to optimize supply of, storage and control energy using digital technologies are growing rapidly as well as innovations in grid systems for next generation transmission network, which contributes to the formation of more flexible energy infrastructure addressing promotion of renewable energy and regional characteristics.
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