Vestas to acquire Mitsubishi Industries Interest in Offshore Wind Segment MHI Vestas; Mitsubishi to Invest in Vestas; The Two Are Working on Green Hydrogen
- Vestas (OTCPK:VWDRY) to buy Mitsubishi's 50% interest in the MHI Vestas JV in exchange for 5.049 mm shares of Vestas (EUR 709 mm).
- Mitsubishi will take a Vestas board seat.
- MHI Vestas has annual revenue of approximately EUR 1.4 B (so they're acquiring at about 1x annual revenues). Growth of this segment has been a bit of a feast or famine given the large order sizes but longer lead times. Offshore is really just getting rolling globally and installed capacity is expected to increase significantly in the second half of this decade.
- MHI Vestas has 3.9 GW in firm orders now and another 1.3 GW of conditional orders and 5 GW installed now with 3,000 employees.
- This compares to Vestas' 16.2 GW backlog and 118 GW installed.
- The segment also has 4.5 GW under service contract.
- Total EBIT margins are 4% and we would expect with the benefits of scale to see this expand over the next several years (more leverage of supply chain, more competitive platform - see below, and more capacity under the service contract).
- The deal is expected close in 4Q20 or 1Q21.
- Favorite Quotes Watch:
- “Vestas is the leader in onshore wind, but to accelerate the energy transition and achieve our vision we must play a larger role in offshore wind. On behalf of all of Vestas, I’m therefore very excited that Mitsubishi Heavy Industries shares Vestas’ vision to become a leading player in offshore wind energy in the long term and will strengthen our partnership by becoming a large shareholder and part of Vestas’ Board of Directors. Offshore wind is key to creating a sustainable planet for future generations and offers unique growth, and with today’s announcement we
