23 May 2013 10:59 GMT
22 April 2013 07:48 GMT
21 December 2012 11:28 GMT
By Karl-Erik Stromsta in London
Wednesday, September 04 2013
Updated: Thursday, September 19 2013
For Power-One, some of the most immediate impacts of the acquisition will be on the bankability of its inverters – making them even more attractive to buyers – and its ability to target far-flung emerging markets, says Alex Levran.
In 2012, more than 80% of sales at Power-One’s renewables division came from Europe. With the European inverter market shrinking more than 50% in revenue terms during the most recent quarter, however, geographical diversification is critical for the company.
The ABB acquisition “opens markets and geographies where we’ve planned to be, but obviously it would have taken us much longer to get there”, Levran tells Recharge.
Power-One – historically a far larger player in the PV inverter space than ABB – has manufacturing operations in the US, China and Italy.
In the past year alone ABB has opened a 500MW inverter factory in Bangalore, India, and announced plans to build a production facility in Johannesburg, South Africa.
In addition to broadening its manufacturing and sales horizons, ABB’s enormous global reach – it has more than 145,000 employees and is present in more than 100 countries – also expands Power-One’s ability to perform after-sales servicing, a critical advantage over many of its more parochial rivals.
In late July ABB formally closed its $1.03bn acquisition of California-based Power-One, the world’s second largest inverter supplier.
At the beginning of this month ABB merged “all the solar inverter capabilities” of both companies into a single group, headed by Levran.
Levran was the long-standing chief technology officer and executive vice president at Italian inverter maker Magnetek until its 2006 takeover by Power-One, where he was promoted to president of the renewables division.
The Power-One brand will be maintained for an “interim phase”, given its global recognition. While future options are under evaluation, the Power-One brand will likely eventually be integrated into ABB.
There is “no question” that Power-One could have continued growing its share of the global inverter market on its own, Levran says.
But "it’s not possible for a pure-play inverter business to grow as quickly as we’ll be able to with ABB and Power-One combined”.
Power-One has long been the world’s second largest supplier of inverters, behind SMA. Although snatching the title as part of ABB "won't be a cake walk", but the prospect looks “very, very good”, Levran claims.
SMA is in the process of laying off hundreds of workers in Germany as it, too, pivots towards new markets. Late last year SMA bought a controlling stake in Chinese inverter maker Zeversolar.
Globally, inverter shipments reached 31GW last year, according to IMS Research. They are predicted to hit 34.5GW this year and grow further next year, although average selling prices are being squeezed as demand shifts to lower-margin countries.
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