ABB (ABB, $$19.4) To Sell Power Grid Unit To Hitachi, At $11 Billion Value; Shareholders to Get Paid From Deal

ABB will sell a majority stake in its Power Grid division to Japan's Hitachi. 

ABB Power Grid division makes transformers and converters, and is the company’s least profitable business. The sale to Hitachi values the unit at around $11 billion. ABB shareholders would receive buybacks and/or other payments from the deal’s cash proceeds of $7.6-7.8 billion. After the deal, ABB is expected to focus more on its automation business.

ABB will have four divisions after the transaction: Electrification, Industrial Automation, Robotics & Discrete Automation, and Motion, which includes motors and drives."Our four newly shaped businesses, each a global leader, will be well aligned to the way our customers operate and focus stronger on emerging technologies such as artificial intelligence," ABB Chief Executive Ulrich Spiesshofer said. After selling the majority stake,the company will retain the remainder of the Power Grid business - with an option to sell that as well to Hitachi after three years.