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ABB has reached an agreement to sell its Power Conversion division to AcBel Polytech, Inc. for $505 million in cash. The transaction is subject to regulatory approvals and is expected to be completed in the second half of 2023. Upon closing, ABB expects to record a small non-operational book gain in Income from operations on the sale. The Power Conversion division, formerly Lineage Power, was acquired by ABB as part of the GE Industrial Solutions acquisition in 2018 and is not core to ABB.
The division is based in Plano, Texas, USA, and employs roughly 1,500 employees worldwide, predominantly at three major sites and the US headquarters. It generated revenues of approximately $440 million and Income from operations of approximately $50 million in 2022, with a clear focus on the North American market.
It is a global provider of end-to-end power conversion solutions for mission-critical applications in the telecommunications, data center and industrial sectors. The business is well positioned and currently capitalizing on key technology mega trends such as the rollout of 5G networks, the increased use of cloud computing and manufacturing automation.
“We are very happy to have found an excellent new home for this specialized business that can go from strength to strength under the leadership of AcBel in the future,” said Björn Rosengren, ABB CEO. “We are also delighted to complete all divisional portfolio divestments announced at the end of 2020, including the sale of Dodge and the spin-off of Accelleron.”
Jerry Hsu, Chairman of AcBel commented: “We sincerely welcome Power Conversion to join the AcBel family. We believe this transaction is beneficial to both parties as we are highly complementary to each other in product portfolio, customer base and expertise. By combining AcBel’s core capabilities in smart manufacturing and original design manufacturing with Power Conversion’s cutting-edge technologies in premium and high-quality products along with its advanced system solutions, we will be able to establish a more comprehensive product portfolio and expand our solution offerings to continue to create value for our customers and investors.”
AcBel (acbel.com) is one of the global leaders in the manufacture and design of switching power supplies. Besides offering power solutions for a wide range of applications including PCs, smart home appliances, smartphones, servers, and networking equipment, AcBel also emphasizes opportunities in sustainable energy and electric vehicles. AcBel is headquartered in Taiwan with over 8,800 employees worldwide, the company aims to power the world with sustainable energy and high efficiency power supplies.
Citi is acting as exclusive financial adviser and Milbank LLP is serving as legal counsel to ABB on the transaction.
ABB (abb.com) is a technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. The company’s solutions connect engineering know-how and software to optimize how things are manufactured, moved, powered and operated. Building on more than 130 years of excellence, ABB’s ~105,000 employees are committed to driving innovations that accelerate industrial transformation.
Important notice about forward-looking information
This press release includes forward-looking information and statements which are based on current expectations, estimates and projections about the factors that may affect our future performance, including the economic conditions of the regions and industries that are major markets for ABB. These expectations, estimates and projections are generally identifiable by statements containing words such as “intends”,“expects”,“plans”, or similar expressions. However, there are risks and uncertainties, many of which are beyond our control, that could delay or prevent the closing of this transaction, and which could affect our ability to achieve all of our anticipated benefits from the transaction. Some important factors that could cause such differences include, among others, business risks associated with the COVID-19 pandemic, the volatile global economic environment and political conditions including the conflict in Ukraine, costs associated with compliance activities, market acceptance of new products and services, changes in governmental regulations and currency exchange rates and such other factors as may be discussed from time to time in ABB Ltd’s filings with the U.S. Securities and Exchange Commission, including its Annual Reports on Form 20-F. Although ABB Ltd believes that its expectations reflected in any such forward-looking statement are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved. The foregoing list of factors is not exclusive and undue reliance should not be placed upon any forward-looking statements, including projections, which speak only as of the date made.
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