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ABB's Swiss Acquisition - Analyst Blog

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ABB Ltd. ( ABB ) has entered into an agreement to acquire a Swiss uninterruptible power supply ( UPS ) company Newave Energy Holding SA. The acquisition will be made for a cash amount of about CHF 170 million.

The addition of Newave's portfolio will solidify ABB's position in the power control and quality market. Currently, Newave products are available in the European markets and after its acquisition by ABB, it will explore other markets.

Per share purchase value of Newave's publicly held shares has been fixed at CHF 56, at 36% premium to the volume-weighted average share price of the last 60 trading days and a 22.4% premium to Newave's closing stock price as of December 9.

The acquisition will enhance ABB's innovation, high quality and technology leadership. Total sales of Newave amounted to CHF 80.6 million in 2010. Newave, an innovative and successful manufacturer of UPS systems, enjoys a strong position in the European markets.

The public tender offer and the closing of the share purchase agreements are subject to regulatory approvals and other customary conditions. In early January 2012, the offer period is scheduled to commence, with the closure of the acquisition expected in the first half of 2012.

Based in Zurich (Switzerland), ABB Ltd. is a global provider of power and automation technologies that enable utility and industry customers to improve performance, while lowering environmental impact. The company serves electric, gas, and water utilities, as well as industrial and commercial customers, with a broad range of products, systems, and services for power transmission, distribution, and power plant automation. The company operates in approximately 100 countries, structuring its global organization into five regions: Europe, Americas, Asia, the Middle East and Africa. A major competitor of ABB Ltd. is Siemens AG ( SI ).

Currently, we are maintaining a Zacks #3 Rank (short-term Hold recommendation) on ABB Ltd.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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