Hitachi and Mitsubishi Heavy Industry in joint bid for Alstom power business
Los Azufres geothermal power plant, Mexico (source: Alstom)
Francisco Rojas
13 Jun 2014
The two Japanese companies would bid $4.9 billion for Alstom’s steam turbine business while Siemens will pay the same amount for Alstom’s gas turbine business. Hitachi and Mitsubishi already have a joint venture operation since 2012.
In a recent news piece from Bloomberg, Hitachi Ltd. will team up with Mitsubishi Heavy Industries Ltd. in a bid for Alstom SA’s power business, strengthening the partnership in energy charted by the two Japanese companies in recent years.
The Japanese duo would join the Siemens AG-led attempt to counter a $17 billion offer by General Electric Co. for the French company.
According to the same source, this plan is a “good thing” for Hitachi, Katsumi Nagasawa, president of Hitachi’s power systems unit, said today in Tokyo. The bid won’t affect Hitachi’s alliance with GE in nuclear energy, he added.
The two Japanese companies would bid $4.9 billion for Alstom’s steam turbine business while Siemens will pay the same amount for Alstom’s gas turbine business, the Nikkei newspaper reported today, without saying where it got the information. Alstom’s grid business wouldn’t be part of the deal, the Nikkei said.
It is not clear yet if Mitsubishi Heavy and Munich-based Siemens AG will decide whether to submit a joint proposal to Alstom’s board of directors by June 16, the two companies said in a statement yesterday, confirming an earlier report by Bloomberg News.
Options Considered
Bloomberg also informs that earlier this year, Mitsubishi Heavy formally began operating a venture with Hitachi. that combined their energy-equipment businesses. The venture, called Mitsubishi Hitachi Power Systems Ltd., was announced in November 2012. Mitsubishi Heavy supplies some of the turbines used by Iceland to tap that nation’s underground sources of geothermal renewable energy. It signed a memorandum of understanding in 2010 with Reykjavik Energy, an Icelandic geothermal power utility, to cooperate on the global development of geothermal energy.
Power systems account for more than a third of Mitsubishi Heavy’s sales and the company has plans to become an even bigger player in the industry.
Source: Bloomberg BusinessWeek Website
