ABB Completes Divestment of Solar Inverter Business to FIMER SpA

ABB has completed its divestment of its solar inverter business to the Italian company FIMER SpA. The transaction enables ABB’s Electrification business to improve the focus of its business portfolio on priority growth markets and enhance business opportunities for the solar inverter business under FIMER. Impact of the transaction on FIMER:

• FIMER becomes the 4th largest solar inverter suppliers in the world
• FIMER is now present in 26 countries with over 1100 employees and one of the largest portfolios of products and marketing channels
• Strong presence on a global scale, from Latin America to North America, Europe, Africa, Asia-Pacific and Middle East
• 3 manufacturing plants, 2 in Italy and 1 in India
• Continuous investment in R&D to develop innovative platforms and solutions
• Commitment to create value and to maintain existing facilities as well as employment levels
• 7+ GW of expected shipments for 2020

Tarak Mehta, President of ABB's Electrification business, said: “The completion of this divestment is another step forward in our strategy of systematic portfolio management. It strengthens our competitiveness and allows us to focus on other growth segments. ABB will continue to integrate solar power into a range of solutions for smart buildings, energy storage and electric vehicle charging throughout intelligent low- and medium-voltage offering.”

ABB’s solar inverter business has approximately 800 employees in more than 30 countries, with manufacturing and R&D sites located in Italy, India and Finland. It includes the solar inverter business from Power-One which was acquired by ABB’s Discrete Automation and Motion division in 2013. The business offers a comprehensive portfolio of products, systems, and services for different types of solar installations. It is currently within ABB’s Electrification business and achieved revenues of approx. $290 million in 2018.

After closing of the transaction, ABB expects the operational EBITA margin for the Electrification business to be impacted positively by slightly more than 50 basis points, supporting the business’ progress towards its target margin corridor of 15-19 percent.

Both companies will ensure a smooth transition for customers and employees. FIMER will honor all existing warranties and ABB will compensate FIMER for taking the business and its liabilities over.

As a result, ABB expects to record a non-operational charge to net income of approximately $430 million in the second quarter of 2019 with the half-year results of 2019 being impacted accordingly. Around 75 percent of this charge is represented by cash outflows ABB will pay to FIMER from the deal closing date through 2025. In addition, ABB expects up to $40 million of carve-out related separation costs starting in the second half of 2019.

Completion is expected in the first quarter of 2020 and will be subject to certain conditions, including the completion of the carve-out and prior consultation with employee representative bodies.

Filippo Carzaniga, Chief Executive Officer of FIMER: “We are glad to announce this further step in our development as FIMER’s focus on the solar business will be greatly enhanced by this integration. Our commitment to positively influencing the energy market will be realized through the development of new product platforms and innovative digital technologies. We will continue the excellent job carried out by ABB in recent years, combining precious resources, knowledge and expertise in Italy and worldwide. With a strengthened portfolio, we are better placed to shape the future of this increasingly strategic business.”