ABB to sell remaining stake in Hitachi Energy to Hitachi
ABB says it will divest its remaining 19.9% stake in its Hitachi Energy JV to none other than Hitach.
Hitachi has exercised its call option that was agreed between the parties in December 2018. The call option’s exercise value is USD 1.679 billion. The companies have agreed to settle the remaining obligations relating to the original transaction, and ABB will continue to provide transition services to Hitachi Energy for them to fully separate from ABB’s systems.
ABB says that it does not expect to record any significant gain or loss as a result of the sale. However, ABB does expect a net positive cash inflow of approximately USD 1.425 billion upon closing of the sale.
“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,” said Timo Ihamuotila, Chief Financial Officer of ABB, in a press release.