Spain’s Gamesa Is in Talks With Siemens on Wind-Turbine Merger

Gamesa Corp. Tecnologica SA of Spain and Siemens AG are in talks to merge wind power units, a combination that could create the world’s largest wind turbine maker.

Gamesa, based in Zamudio, Spain, said negotiations are on a “potential integration of certain wind businesses of Siemens and the company via a merger,” according to a regulatory filing Friday. No decision has been made, it said.

Siemens would hold a majority in the combined entity and a deal could be announced in the coming days, according to a person familiar with the matter, who asked not to be identified because discussions are private. Siemens is also holding talks about buying Iberdrola SA’s 20 percent stake in Gamesa, according to people familiar with the matter.

Siemens spokesman Dennis Hofmann declined to comment.

Gamesa’s network of installed turbines is attractive to Siemens, which has been trying to expand the proportion of its revenue from service contracts. The German engineering firm leads in machines designed for use offshore, while Gamesa specializes in on-shore wind. Together, they would have about 15 percent of the global wind market, making the combined company the world largest maker of wind turbines, exceeding Vestas Wind Systems A/S’s 10 percent share, and General Electric Co.’s 11 percent, according to data compiled by BNEF.

Gamesa shares rose 19 percent to close at 17.11 euros, valuing the company at 4.8 billion euros ($5.2 billion). El Confidencial website reported earlier on Jan. 29 that Siemens was exploring a purchase.

©2016 Bloomberg News

Lead image credit: Gamesa.

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