More Wind for GE with Acquisition of LM Wind Power
GE has announced the purchase of LM Wind Power for €1.5 billion. The deal in-sources wind turbine blade design and manufacturing for GE’s Renewable Energy business. Since 2001, LM Wind Power has been owned by Doughty Hanson, a private equity firm. The transaction is subject to the customary regulatory and governmental approvals and GE expects to close the transaction in the first half of 2017.
GE expects the acquisition to be accretive to earnings in 2018. Jérôme Pécresse, President and CEO of GE Renewable Energy says, “With this acquisition, we will be more local, have more flexibility and knowledge in turbine design and supply, and have a greater ability to innovate and reduce product costs, while at the same time improving turbine performance. We will also develop enhanced digital and service capabilities, all of which will be good for customers, competition in the industry, and the growth of wind power globally.”
Marc de Jong, CEO of LM Wind Power, says, “This deal will merge the speed and focus of LM Wind Power’s entrepreneurial culture with GE’s world-class engineering and operational capabilities. Our two organisations are highly complementary and the transaction positions us well to respond faster to customer needs and to enhance the performance of wind turbines to ultimately reduce the cost of energy. We look forward to working closely with the GE Renewable Energy team, to accelerating our growth strategy and continuing to deliver greater value to all our customers.”
With over three decades of experience and 190 patents, LM Wind Power offers blade development, manufacturing, service and logistics. Today, GE no longer produces blades and LM Wind Power is its largest blade supplier. Since 1978, LM Wind Power has produced more than 185,000 blades, corresponding to approximately 77GW of installed wind power capacity, which can effectively replace approximately 147 million tons of CO2 each year. In eight countries across four continents, LM Wind Power has thirteen factories located in or close to key wind power growth regions from where it can effectively serve its customers.
Following the closing of the deal, GE intends to operate LM Wind Power as a standalone unit within GE Renewable Energy and will continue to fully support all industry customers with the aim of expanding these relationships. GE will also still be able to source blades from other suppliers. LM Wind Power will continue to be lead by its existing management team and be headquartered in Denmark, where it also maintains a global technology centre.