Hitachi Ltd to Buy ABB's Power Grid Business for USD 9.6 Bn

Hitachi Ltd is close to a deal to purchase ABB Ltd's power-grids business for as much as 800 billion yen (S$9.6 billion), the Nikkei reported.

The board of the Tokyo-based conglomerate confirmed plans to move forward with the transaction, a leading Japanese newspaper said, adding that the two companies will soon conduct a final assessment of the business and may reach an agreement as early as this week.

A representative for Hitachi didn't respond to calls seeking comment while a spokesman for ABB said he couldn't provide immediate comment. ABB shares rose 1.9 per cent to 19.35 francs(S$26.76) at 10.37 am in Zurich, giving a market value of 42 billion francs.

The Swiss engineering firm was considering the sale of the business and discussing options with advisers, Bloomberg News reported in August. The division's implied valuation was more than US$10 billion following productivity and margin gains, according to a Bloomberg Intelligence analysis the same month. The Financial Times reported last month that the unit was worth about US$13 billion, citing analysts.