(CercleFinance.com) – ABB has reached an agreement to sell its remaining 19.9% stake in the Hitachi Energy joint venture to Hitachi. Hitachi holding an 80.1% stake.
The exercise value of the call option is $1.679 billion. ABB expects positive net cash inflows of approximately $1.425 billion at closing.
“This agreement will strengthen our balance sheet and give us additional flexibility in our capital allocation decisions,” said Timo Ihamuotila, ABB’s chief financial officer.
At the same time, ABB has advanced discussions with the relevant authorities regarding issues related to the Kusile project in South Africa, awarded in 2015.
ABB will make a non-operating provision of approximately $325 million which will be reflected in the operating result of the third quarter 2022 results.
Based on these discussions, ABB does not believe that it will need to make any significant additional provisions related to these matters.
The company continues to cooperate fully with the respective authorities and hopes to reach a final settlement with them in the short term.
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