Two international vendors with roots in Japan said Nov. 29 that they are integrating their thermal power generation businesses.
Mitsubishi Heavy Industries, Ltd. (MHI) and Hitachi, Ltd. said they plan to consolidate their respective power generation operations within a joint venture company by Jan. 1, 2014.
MHI and Hitachi will take equity interests of 65% and 35%, respectively, in the joint venture. The companies hope to execute a final agreement in April 2013.
The global market has continued to expand, driven by the growth engines of China and other emerging countries. Heightened environmental awareness around the world has presented a major opportunity for MHI and Hitachi to expand businesses where they both excel—businesses that solve global energy and environmental issues at the same time, the companies said.
The two Tokyo-based companies have teamed up in various business sectors in the past. These include steel production, railway systems, and the integration of the hydroelectric power generation system business. Both companies also provide support for Tokyo Electric Power’s Fukushima Daiichi Nuclear Power Station, which suffered a major meltdown accident in 2011.
The thermal power generation venture will be overseen by an integration preparation committee.
In the thermal power generation field, the two companies both have expansive product lineups. For example, in gas turbines, MHI has focused on highly efficient large models in recent years. Meanwhile, Hitachi sees its mainstay products as small and medium-sized models. Regionally, MHI has strengths mainly in Southeast Asia and the Middle East, while Hitachi has harnessed its strengths in markets such as Europe and Africa, the companies said in a news release.
Mitsubishi was founded in 1950 while Hitachi was established in 1920. Both companies employ a fiscal year that starts in March.