Mitsubishi expands network
Four new subsidiaries are to be added to Mitsubishi’s global network, the company has announced. The subsidiaries will be in Brazil, India, Singapore and Korea.
Mitsubishi said within three years the new Brazilian company, Mitsubishi Industrias Pesados do Brasil, based in Sao Paulo, was expected to produce orders worth $144m. Mitsubishi Heavy Industries India, based in New Delhi, is intended to be a “comprehensive regional base” with operations including procurement and production as well as sales. It is expected to have annual sales of $96m within three years.
Mitsubishi Heavy Industries Singapore and Mitsubishi Heavy Industries Korea are expected to produce annual sales of up to $384m and $480m, respectively.
Elsewhere, Mitsubishi is expanding its commitment in the wind power industry. It has built a new wind turbine fabrication facility at its Nagasaki works. The new plant will increase turbine production capacity by 60 per cent, to 480 units per year.
Enel gets back to core business
Enel SpA has completed divesting its water businesses in order to focus on its core businesses of electricity and gas.
The Italian utility had previously announced a planned exit from the water sector. In December it announced the transfer of both Hydro SpA and 20 per cent of its holding in Idrosicilia to Compagnie Generale des Eaux, part of the Veolia Environnement group. A put and call option is in place for the sale of Enel’s remaining stake in Idrosicilia.
The deal, worth around $48m, will be complete this quarter, pending antitrust approval.
Enel has also recently completed the sale of its high voltage transmission assets in Spain, owned by Enel Viesgo, to Spain’s national grid operator Red Electrica. Enel Viesgo received $60m for the assets and $2.4m for a three year operation and maintenance contract.
Recent reports suggest that Enel is ready to take a stake in French utility Electricité de France (EDF) as soon as the French government privatizes the company. The deal would give Enel more power in buying electricity in the French market: according to Italian newspapers, EDF raised its prices from €6.7 ($9) per MWh to €42 in recent contracts.
E.ON announces €18bn three-year investment plan
E.ON will invest €18.7bn ($24.6bn) worldwide over the next three years, it has announced, with the largest areas of investment likely to be the central Europe region and the pan-European gas market.
The company said it had earmarked €6.8bn for central Europe, where it planned to build two new power stations, one coal fired and one gas fired. Other investment in the region would increase E.ON’s stake in the delivery business, where it expected to take a majority of two Bulgarian distribution networks and increase its gas holdings in Hungary, as well as acquiring a majority interest in ZSE, an acquisition that depends on the Slovakian government.
In the gas market, two thirds of E.ON’s €4.3bn budget will be used to increase shareholdings, with Hungarian gas and oil company MOL, a major target. The remainder will be invested in gas transport and storage infrastructure.
The Nordic market will see investment of €3.7bn, largely in increasing E.ON’s stake in Sydkraft.
Alliance announced on clean coal
Black & Veatch and Uhde GmbH have announced an alliance to pursue clean coal projects using gasification technology.
The two companies will offer EPC services for commercial offerings of gasification and integrated gasification combined cycle (IGCC) plants using Shell coal gasification technology. Plants will be fuelled by coal or petroleum coke.
Uhde, headquartered in Germany, jointly developed coal gasification technology with Shell in the 1970s and has built more than 100 gasifiers using its own or licensed technology.
EME acquisition completed
International Power (IP) and Mitsui & Co have completed their acquisition of Edison Mission Energy’s international generation portfolio. The acquisition was agreed “overwhelmingly”, IP said in November.
The acquisition is shared 70:30 between IP and Mitsui and was priced at $2bn. Originally it was to have been partly funded by a senior secured bridge loan but IP said this had now been replaced by a structured eight-year term loan of $797m.
The deal inclues all of EME’s portfolio except three plants: CBK, a hydro scheme in the Philippines; Tri Energy, a gas fired project in Thailand; and Doga, a Turksi gas fired plant. Those plants will be held under contract by the three companies with a view to completing their acquisition at a later date.
Completion of the deal was expected to improve IP’s credit rating after it was placed on CreditWatch by Standard & Poor’s in mid 2004.
British Energy losses: The closure of two of British Energy’s nuclear plants for safety inspections has pushed half year pre-tax losses at the company to £234m ($439m), four times the amount it lost in the same period last year. The company warned that its future remains challenging.
Fossil deal: Washington Group International and DTE Energy have signed an EPC alliance and together will work on $2bn worth of contracts over eight years. The alliance will perform retrofits and maintenance at Detroit Edison fossil plants.
Greek wind: Spanish electricity group Iberdrola has entered the Greek market with the intention of acquiring a 49.9 per cent stake in Rokas, the country’s leading producer of wind energy. Iberdrola has already purchased a 21 per cent interest for €35.5m ($47m).
Hydro buyback: Norsk Hydro has won approval to continue its buyback programme over the next 18 months at an EGM in December. The meeting also approved a capital reduction equivalent to 2 per cent of share capital.
Name that turbine: Siemens Power Generation has adopted a new naming strategy for all its products. President and CEO Randy Zwirn said the new naming system would be easier to identify, reference and understand.
Refinancing: The Chivor hydro-electric plant in Colombia, which provides 11 per cent of the country’s electricity, has successfully completed a $253m refinancing. The company is an indirect subsidiary of US-based AES.
RWE Solutions: The technology division of German energy group RWE is to be broken up. Part will be taken over by RWE Energy AG and the rest will be sold off.
Texas power: Constellation NewEnergy has won a $100m contract to supply power to a cluster of 78 Texas companies. The companies are jointly represented by Priority Power Management, which provided each company with a customized contract.
VA decision: An Extraordinary General Meeting on 17 January could determine whether a bid by Siemens for VA Tech is accepted. VA Tech’s board said it was ‘neutral’ on the bid but there were concerns over the fate of VA Tech’s hydro business.
Vattenfall in Denmark: Vattenfall said that it had responded to shareholder wishes in making an offer for Danish electricity company Elsam. The offer was higher than that made by Dong, which had already agreed a merger with Elsam worth $8.8bn, and may interrupt the sale.