German wind turbine maker Senvion SA has reached an agreement to sell much of its European onshore services business, as well as a blade manufacturing facility in Portugal, to Siemens Gamesa Renewable Energy SA for €200 million.
Senvion filed for insolvency in April. "This has been a long and demanding path in a challenging context and in the face of many difficulties, but I am very confident that the business is well-positioned under the new ownership," Yves Rannou, the company's CEO, said in an Oct. 21 statement.
Senvion said it continues to wind down other parts of its business to secure acceptable solutions for remaining employees and an orderly liquidation of remaining assets. It is also still involved in talks with potential investors for other parts of its business, including Indian and other non-European service operations.
On Siemens Gamesa's side, the acquisition of Senvion's 8.9-GW service fleet takes its total capacity under maintenance to 69 GW. The company said the deal will also diversify its business mix and geographical exposure with contracts that offer long-term visibility and historically high renewable rates.
Analysts at UBS said the transaction could be "value-accretive" for Siemens Gamesa. "Our prima-facie analysis suggests that, if Siemens-Gamesa were able to derive c20-21% margins for the service business (i.e. to the current levels of service margins of SGRE), the service assets alone could potentially have a value of c€350m," UBS Analyst Supriya Subramanian said.
The investment bank reiterated its "buy" rating on Siemens Gamesa with a €15 price target.
Rothschild & Co is acting as financial adviser to Senvion on the transaction.