Siemens, Gamesa set to gain EU approval for wind power merger -sources
German engineering company Siemens and Spain’s Gamesa are set to win unconditional EU antitrust approval to create the world’s biggest wind turbine maker, two people familiar with the matter said on Thursday.
The companies announced the deal last June, part of a recent wave of consolidation in the wind energy industry as companies seek to rein in costs and remain competitive.
The merged company, with a market capitalisation of around 10 billion euros ($10.5 billion), will combine Siemens’ strength in offshore windpower and Gamesa’s strong presence in fast-growing markets such as India, Mexico and Brazil.
It will leapfrog current world No. 1, Denmark’s Vesta in market share. Other players in the sector include General Electric, Germany’s Enercon and Nordex, and a host of Chinese companies.
Under the deal, Siemens will pay 1 billion euros in cash to Gamesa’s shareholders to take a 59 pct stake.
There had been market speculation that the European Commission might demand concessions but the companies were able to convince the regulator that the deal would not hurt competition, one of the sources said.
The Commission is due to announce its decision by March 13.
Commission spokesman Ricardo Cardoso and Gamesa declined to comment. Siemens said it does not comment on market rumours and speculation.
Cost savings and benefits from the new business, which will be operational by the end of the first quarter of next year, will be worth 230 million euros of earnings before interest and taxes (EBIT) within four years, Gamesa said when the deal was announced. ($1 = 0.9504 euros)
Source:reuters
