ABB Wins Propulsion Contract in Finland - Analyst Blog

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ABB Ltd. ( ABB ) recently won a contract from the Finnish Transport Agency (FTA) to provide power solutions including Azipod propulsion units and an electric power plant for the Arctech Helsinki Shipyard. The financial terms of the deal remain undisclosed.

The vessel was conceptualized by experts at Aker Arctic Technology and ILS. The design required it to be adept at meeting the challenging conditions at the sea while simultaneously being responsive to the open sea oil spill conditions. The vessel also demanded to be enabled to execute its towing functions throughout the year, especially amid inclement weather conditions. ABB's technology was selected among several bidders for the contract.

The scope of the contract requires ABB to provide state-of-the-art icebreaker vessels to sustain the harsh conditions at the Baltic Sea. The company will be manufacturing the vessel using advanced technology that makes it efficient yet easy to maintain. The vessel, which is expected to be completed by 2016, will be one of its kinds, possessing dual fuel capability that will cut down on both the emission levels and costs as it will be fueled by liquefied natural gas (LNG).

ABB's three-pod propulsion solution having a 6MW Azipod unit placed at the bow and a couple of 6.5MW units that will be positioned at the stern of the vessel will ensure optimum efficiency levels along with ease of movement across the ice-ridges in the sea.

ABB has been a pioneer in podded propulsion technology. The increasing safety and regulatory norms for sea transport have been driving ABB's business as its Azipod technology has met the most stringent norms in the industry. The high-demand Azipod propulsion system was jointly developed by ABB and Helsinki shipyard in 1987.  Besides strengthening the company's relations with Finland, this contract will also benefit both the entities significantly going forward.

ABB currently has a Zacks Rank #5 (Strong Sell). Some better-ranked stocks that can be considered at the present include AVT Inc. ( AVTC ), EnerSys ( ENS ) and AO Smith Corp. ( AOS ).  All these stocks carry a Zacks Rank #2 (Buy).


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This article appears in: Investing , Business , Stocks

Referenced Stocks: FTA , LNG , ABB , AOS , AVTC

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