German engineering company Siemens is close to a deal to combine its wind business with rival Gamesa, Bloomberg reported.
The combination of wind units of Siemens and Gamesa would create the world’s largest wind-turbine maker, ahead of GE.
On January 29, Gamesa, based in Zamudio, Spain, said it was in talks to combine its operations with Siemens.
Siemens aims to hold a majority stake in the combined entity. Europe’s largest engineering company is also holding talks about buying Iberdrola SA’s 20 percent stake in Gamesa.
The Spanish company’s network of installed turbines is attractive to Siemens, which has been trying to expand revenue from service contracts. The German engineering firm leads in machines designed for use offshore, while Gamesa specializes in on-shore wind.
Together, they’d have about 15 percent of the global wind market, making the combined company the world’s largest maker of wind-turbines, exceeding Vestas Wind Systems’s 10 percent share, and General Electric’s 11 percent, said the Bloomberg report.
The wind division is the smallest of Siemens’s eight operational businesses, and also has the lowest profitability target.