ZURICH (dpa-AFX) - ABB Ltd. (ABB.ST, ABBNY), a technology company, on Tuesday announced that it will acquire a 51 percent controlling stake in a joint venture with Mitsubishi Electric Corp. (6503.T).
The company said the new entity is expected to be established on December 1, with the business transfer and joint venture transaction scheduled to close on October 1, 2027.
ABB said that the deal is expected to close in the second half of 2027.
The joint venture will focus on the low-voltage power distribution business. ABB will pay JPY 79 billion, or approximately $495 million, for the stake.
ABB will acquire a controlling 51 percent stake in the joint venture for JPY 82.4 billion or approximately $516 million, while Mitsubishi Electric will retain a 49 percent stake.
The joint venture will combine Mitsubishi Electric's power distribution products, technology and customer relationships with ABB's global technology and sales network to expand across Japan and other Asia-Pacific markets.
ABB expects the joint venture to be accretive to earnings per share after the first year and achieve an operational EBITA margin of at least 20 percent within five years.
The business includes low-voltage circuit breakers, switches, measurement and control equipment, and uninterruptible power supply systems.
Mitsubishi Electric's low-voltage power distribution business generated net sales of approximately JPY 102.2 billion in the fiscal year ended March 2026 and employs around 2,800 people.
Mitsubishi Electric expects to record a gain of approximately JPY 90 billion from the transaction in the fiscal year ending March 2028.
On Monday, ABB Ltd. closed trading 1.38% lesser at SEK 897.40 on the Stockholm Stock Exchange.
Copyright(c) 2026 RTTNews.com. All Rights Reserved
Copyright RTT News/dpa-AFX
© 2026 AFX News
