With a view to achieving its goal to become a decentralized global technology company, recently ABB has disinvested 80.1 per cent of its Power Grids business to its long-term partner Hitachi. This will allow ABB to concentrate on key market trends and customer needs like the electrification of transport and industry, automated manufacturing, digital solutions and increased sustainable productivity. However, ABB will initially retain a 19.9 per cent equity stake in the joint venture that will operate as Hitachi ABB Power Grids and be headquartered in Switzerland. The company has a pre-defined option to exit the retained 19.9 per cent shareholding three years after closing.
Elaborating on the action, Peter Voser, Chairman of the Board of Directors of ABB, said, “Since announcing our intention to divest Power Grids to Hitachi, ABB has made significant progress in becoming a more customer-focused and simplified organization. We believe Hitachi is the best owner for Power Grids and its next stage of development, building on the solid foundation achieved under ABB’s previous ownership. ABB remains committed to using net cash proceeds from the transaction for a share buyback program. Our goal is to execute this in an efficient and responsible way, taking account of the prevailing circumstances.”
Focusing more deeply on the ABB’s latest target, Björn Rosengren, CEO of ABB, said, “With the divestment, ABB is well positioned for the future with a strong focus on industrial customers. Leveraging our technology leadership and passion for innovation, we will now focus on creating superior value for our customers, employees and shareholders. We will do this by evolving our decentralized business model, strengthening our performance management culture and driving active portfolio management.”