ABB could initiate sale of Power Grids later in the year
ABB, the Swiss industrial giant, could initiate the sale of its Power Grids division later this year, according to Dagens Industri. This is after ABB announced last year that it had initiated a strategic review of its Power Grids division.
The Swedish business daily reported that ABB's automation business is likely to be affected by the decreasing price of oil as well as the Chinese market slowing down. Selling Power Grids would give ABB's restructuring process more time to take effect and increase ABB's share price.
The paper wrote, without citing any named sources, that ABB's major shareholders are pushing for the review to be concluded by late summer and that a sale of Power Grids will follow. The paper reported further that Power Grids is expected to fetch USD 12-15bn.
The item noted that regulatory rules will hinder ABB's competitors Siemens and General Electric from bidding, but other possible bidders are State Grid Corporation of China (SGCC), Mitsubishi Hitachi Power Systems, Toshiba and Shanghai Electric Group.
Power Grids has a turnover of over SEK 100bn (EUR 10.7bn), the paper wrote. ABB's largest shareholders are the Swedish investment company Investor with 10.03% of the votes and capital, Swedish activist fund Cevian Capital with 5.16% and American PE firm Blackrock with 4.18%.
Dagens Industri