Hitachi and MHI merger talks stall over extent of alliance

Merger talks between Hitachi and Mitsubishi Heavy Industries (MHI) have stalled due to conflicting views of the ideal extent of the proposed alliance, said the Financial Times.

Hitachi is keen to explore a full merger but MHI would prefer a narrower agreement focused on infrastructure businesses such as nuclear power, according to the newspaper’s sources.

Hitachi’s president Hiroaki Nakanishi on 4 August confirmed a report in the Nikkei business daily that the companies were on the verge of a deal. But MHI later contradicted Nakanishi in a news release that said nothing had been decided and that it had “no plans to merge”.

Both companies’ outlooks have suffered from the nuclear meltdowns in Fukushima, which have made it harder for them to compete with global engineering rivals such as General Electric and Siemens. The yen’s gradual rise in exchange rates has added to the challenge.

MHI is wary of being dominated by the larger Hitachi, whose market value of roughly 2100bn yen ($27bn) is more than one and a half times that of MHI, according to experts who spoke to the Financial Times.

GDF Suez in alliance with China’s CIC

China’s sovereign wealth fund is to buy a stake in GDF Suez’s gas exploration and production unit and to finance the French utility’s expansion in power-thirsty Asia, said Reuters.

The multi-billion dollar memorandum of understanding with China Investment Corp (CIC) is the latest bid by the world’s biggest utility to boost its presence in faster-growth emerging markets.

“The deal is a very broad one. Its first manifestation will be the entry of CIC in the capital of GDF Suez’s exploration and production subsidiary with roughly 30 per cent,” said one source.

Direct Energie buys Poweo share to become France’s third largest supplier

Direct Energie, a French power supplier, has bought 46 per cent of domestic rival Poweo SA from Verbund AG for €36m ($52m) to become France’s third-biggest power supplier after Electricite de France SA and GDF Suez SA.

The combined entity will have 1 million residential and business power and gas customers. Direct Energie and Poweo will hold an option for all Poweo’s production sites.

Clipper drops 10 MW offshore wind turbine project in UK

The Britannia project to build a giant 10 MW offshore wind turbine in the UK is on hold after the US manufacturer and the UK’s Crown Estate terminated an agreement signed in 2008.

United Technologies (UTC), which bought out Clipper in December last year, has returned an investment of à‚£1.6m ($2.65m) plus value-added tax to the Crown Estate, which is leading the development of offshore wind farms around the UK’s coasts. Clipper’s decision is believed to reflect changed financial conditions as well as an increase in competition ” with Doosan, Gamesa, GE, REpower, Siemens and Vestas now also looking to build turbines in the UK.

But the company says it has no plans for layoffs in the UK and it will not immediately sell off assets such as its blade facility in Tyneside in northeast England.

Clipper’s prospects have been hit by blade cracking that has cost it more than $330m. The firm has yet to announce major turbine sales since its takeover by UTC.

E.ON looks to shed 11 000 staff

E.ON will respond to a “dramatic deterioration” in its outlook following Germany’s decision to phase out nuclear power with cost cutting that will bring between 9000 and 11 000 layoffs, said its chief executive Johannes Teyssen.

E.ON reported a first quarterly loss of €382m ($548m) in the second quarter, while the company’s overall net income in the first half fell 71 per cent to €900m.

Cost cutting will aim to save €1.5bn every year until 2015, thereby reducing E.ON’s controllable costs to an annual maximum of €9.5bn. E.ON aims to shed between 11 and 13 per cent of its 85 600 workforce.

Sahara Power and Korea East-West set up partnership

Sahara India Power and Korea East-West Power, a Korean government company, have jointly announced a partnership to set up power plants with a combined capacity of up to 6000 MW in India.

The agreement allows the two companies to jointly participate in tariff-based bidding for ultra-mega power projects (UMPPs) and other opportunities in India. The deal is an extension of an earlier agreement between the companies for setting up a 1320 MW power plant in Titlagarh.

ࢀ¢ ࢀ¢ ࢀ¢

Alstom: The company has signed a €330m 20-year service contract with Dalia Power Energies Ltd for the 835 MW Tzafit gas fired plant in Israel.

Dynegy Inc: The US’s third largest independent power producer has completed a $1.7bn debt restructuring deal and separated its coal-fuelled and gas-fuelled power generation units as it works to pay off about $1.3bn in maturing debt.

Echelon and Holley Metering: The energy control networking company Echelon Corporation of the USA and the Chinese manufacturer of energy meters Holley Metering have announced a new partnership to supply more than 10 million smart grid meters into the Chinese and global markets in 2011.

GDF Suez: The French company and its partners at International Power announced they have secured power purchase agreements for two wind farms in Ontario, Canada, each to be 99 MW. Construction has also started on a third 99 MW plant in British Columbia.

GE Energy: The company has released its new platform of Multilin distribution automation controllers for maximizing grid efficiency and reliability as part of a voltage and VAR control solution to optimize grid efficiency through peak load shaving and reduced power losses.

Metso: Metso is joining forces with SAC and Guodian Nanjing Automation Co Ltd in a joint venture focused on developing the digital power plant concept, especially in China. Metso will hold 33 per cent of the new firm and SAC 67 per cent.

SN Power: The hydropower investor is to pay $440m for a majority shareholding in the Brazilian renewable power company Desenvix, which has 162 MW assets in operation, 176 under construction and a 1600 MW portfolio of projects under development.

Tepco: The operator of Fukushima Daiichi reported a 571.7bn yen ($7.4bn) net loss for its first quarter as it began to count the cost of compensation for local families.

Westinghouse: The firm is to receive its final safety evaluation report from the NRC on the AP1000 pressurized water reactor (PWR) design. “We’re in the home stretch to receive final approval of the amended AP1000 design,” said CEO Aris Candris.

More Power Engineering International Current Issue Articles
More Power Engineering International Archives Issue Articles

No posts to display