July 9 (Renewables Now) - Swiss group ABB Ltd (SWX:ABBN) announced on Tuesday it has entered into an agreement to sell its solar photovoltaic (PV) inverter business to Italian sector player Fimer SpA so it could concentrate on other growth markets.
The business being sold employs some 800 people in over 30 countries and generated about USD 290 million (EUR 259m) in revenues last year. It includes the solar inverter operations of Power-One, which was bought by ABB in 2013.
The transaction is seen to close in the first quarter of 2020. ABB estimates that it will affect the company’s half-year results of 2019 since it will result in an after-tax non-operational charge of around USD 430 million, including cash outflows paid to Fimer from the deal closing through 2025. Furthermore, ABB anticipates up to USD 40 million of carve-out related separation costs beginning in the second half of 2019.
Upon finalisation, the move will improve the operational EBITA margin for ABB’s Electrification business by slightly more than 50 basis points.
“The divestment is in line with our strategy of ongoing systematic portfolio management to strengthen competitiveness, focus on quality of revenue and higher growth segments,” said Tarak Mehta, President of ABB's Electrification business.
(USD 1.0 = EUR 0.892)