Japanese industrial giant Hitachi signaled its ambitions to play a central role in the energy transition after making a $6.4bn swoop for control of the Power Grids business of ABB.

Hitachi said the agreed acquisition will marry ABB’s existing position in transmission and grids – which ranges from long-distance HVDC lines to transport wind power, to advanced microgrids to optimise solar – with its own expertise in digital technologies.

The conglomerate said the combination will address the global need for “advanced energy management systems for next-generation transmission networks, which contribute to the more flexible energy infrastructure addressing promotion of renewable energy and regional characteristics”.

Hitachi will initially control 80.1% of the Power Grids operation under a joint venture deal with ABB – which will itself focus on its other interests in robotics and automation – but the Japanese group has a purchase option to buy the remainder. The two agreed a total enterprise value of $11bn for the unit.

Recent deals announced by ABB in the renewables arena include work for Orsted on the 1.4GW Hornsea 2 offshore wind farm, and a first-of-a-kind HVDC mega-system in China.

Transition

Hitachi buys ABB Power Grids unit in $6.4bn deal