ABB and Newave, a swiss based UPS manufacturer, agreed in a full cash deal. Through this acquisition, ABB targets a stronger position in the UPS market.
The leading power and automation technology group, and Newave Energy Holding SA, a Switzerland based leader in uninterruptible power supply (UPS), have agreed that ABB will acquire Newave in an all-cash transaction valued at approximately CHF 170 Million (USD 183 Million). The deal will strengthen ABB’s position in the power control and quality market and provide Newave with significant growth opportunities outside its traditional markets in Europe.
Under the terms of the transaction agreement, ABB announced a voluntary all-cash public tender offer of CHF 56 (USD 60.4) per Newave share to purchase all of Newave’s publicly held shares. The offer prospectus will be published on or around Dec. 15. The offer represents a premium of 36.0 percent to the volume-weighted average share price of the last 60 trading days and a 22.4 percent premium to Newave’s closing stock price on Dec. 9. The Committee of independent members of the Board of Directors of Newave will unconditionally recommend that Newave shareholders tender their shares in the offer.
Newave, headquartered in Quartino, Switzerland, generated a net income of CHF 8.1 Million ( USD 8.73 Million) on sales of CHF 80.6 Million (USD 87 Million) in 2010. The company was founded in 1993 and went public in 2007. Newave has established a strong market position in Europe as an innovative and successful manufacturer of UPS systems with a focus on the development and production of power protection technology, as well as on technical consultancy, maintenance and service packages. ABB plans to integrate Newave in its Discrete Automation and Motion division and develop Quartino to become a main location for ABB’s UPS systems. ABB will provide a fast, global exposure for Newave’s UPS systems and will ensure that Newave can increase the high innovation rate of its current product range.
“The combination of two strong, complementary companies will create significant value-driven growth based on innovation, high quality and technology leadership,’’ said Ulrich Spiesshofer, head of ABB’s Discrete Automation and Motion division. “The acquisition is fully in line with ABB’s strategy for power control and quality and with the goal of the division to build on its existing strength in power electronics. Newave provides us a best-in-class player in the fast-growing UPS market, while our global sales channels will significantly expand Newave’s geographic reach.”
“Combining our business with ABB will give Newave important strategic and operational advantages. As Chairman of the Board of Directors of Newave, I am convinced that ABB is the ideal partner for the continuous successful development of our company,” said Newave’s Vllaznim Xhiha. “Besides the immediate financial added value of the offer for the shareholders, we also expect considerable additional development potential for Newave’s business partners and its employees.”
The global UPS market offers interesting growth opportunities, mainly in the areas of datacenters, industry and infrastructure. ABB will expand into a $6 billion to $7 billion market and close a white spot in core datacenter electrification and industrial power quality. Newave is active in the medium- and high-power UPS range, which is the most attractive segment since it represents 50 percent of the overall UPS market with a yearly growth rate of 6 to 10 percent. ABB has a strong presence in industrial markets and already offers industrial UPS products. It recently acquired a majority share in the DC datacenter solution provider Validus. Combining ABB’s and Newave’s market presence and technological expertise will allow ABB to offer a complete range of UPS solutions to industrial, commercial and datacenter clients with a comprehensive alternating current (AC) and direct current (DC) solutions portfolio, reinforcing its strategic differentiation.