Danish wind turbine giant Vestas is to spin off its converters and controls business to help support its strategic foucs.
An agreement has been struck with compatriot KK Wind Solutions for the business, which includes factories in Denmark, India and China.
As part of the deal, around 600 Vestas employees will make the switch over.
Once the sale goes through, KK will exclusively supply converters and control panels to Vestas from the three factories.
There is also the potential for local expansion and job growth by extending the use of converter technologies in adjacent areas, like Power-to-X.
The agreement builds on years of collaboration between KK and Vestas, most recently shown by localisation of offshore power conversion modules and low voltage cabinets in Taiwan.
Tommy Rahbek Nielsen, executive vice president and chief operating officer, at Vestas, said: “Across our global supply chain footprint, we are increasingly collaborating with partners to scale efficiently and build on the foundations we have established.
“This includes focusing our own resources to where they are most efficient and moving parts of our business to be run by other industry leaders who can create more value and secure additional long-term jobs.
“I’m therefore very excited about the agreement with our partner KK Wind Solutions, which can help grow and mature the wind energy supply chain.”
The transaction is expected to close in the first quarter of 2023, subject to receipt of approvals from the relevant regulatory authorities and separation of the converters and controls business.
At that point, the transaction will be reflected in Vestas’ financial accounts.
Mauricio Quintana, chief executive officer at KK, said: “As an established partner to Vestas, we aim to take a leading role in maturing the industry’s supply chain and accelerate the green energy transition.
“The acquisition will bring immediate scale to our operations and extend our global footprint, while adding new competencies by welcoming over 600 highly skilled and experienced employees.
“As a result, we will be well-positioned to develop and deliver world-class sustainable energy solutions to top tier wind OEMs and expand further into adjacent industries, such as Power-to-X.”
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