Engineering giant ABB is to divest its high-voltage cable business to NKT in a €836m deal.
The decision by the Swiss company follows a strategic review of its power grids division and the transfer will be completed early next year.
NKT already designs, manufactures and supplies cables in low, medium and high voltages, mainly AC. The ABB portfolio of HVDC, long distance and other cabling is seen as complementary.
The deal also includes the transfer of ABB’s newbuild “cutting-edge” cable-laying vessel, currently under construction.
“We are combining two strong cable portfolios rooted in a shared Nordic heritage that will be more competitive on a larger scale under NKT Cables’ ownership, while maintaining access to supply through a long-term strategic partnership,” said ABB chief executive Ulrich Spiesshofer.
“The combination of our niche cable system business with the strength of NKT Cables demonstrates our commitment to active portfolio management, a key element of our ‘next level’ strategy.”
NKT chief executive Michael Hedegaard Lyng said: “ABB’s high-voltage cable business will add considerable strength to our portfolio and bring us a world-class manufacturing operation. We will leverage the technology, domain competence and highly skilled workforce to grow this business.”
ABB’s cable business is based in Karlskrona, Sweden, had revenues of $524m in 2015 and it employs 900 people.
Goldman Sachs acted as exclusive financial advisor to ABB on the deal and Freshfields Bruckhaus Deringer as legal advisor.
Image: subsea installation of ABB wires (ABB)
ABB wire transfer to NKT
€836m deal for high-voltage business includes newbuild cablelay vessel
By EBS