Because Hitachi will buy Thales’ railway business
The French group Thales has found a buyer in Hitachi Rail for its Ground Transportation Systems division. All the details
Thales ready to sell its GTS railway signaling business to Japan's Hitachi Rail.
The Japanese conglomerate Hitachi has announced an exclusive negotiation with the French company Thales for the purchase of the railway signaling activities of the group, valued at 1.66 billion euros.
The GTS signaling unit, which also offers train control systems and fare collection services, is small compared to competitors, notes Reuters . The sale comes at a time of consolidation in the industry as independent players align with larger industry groups.
Also, as reported by Reuters in July, Hitachi Rail was making a bid in competition with Switzerland's Stadler Rail and Spain's CAF to purchase Thales' GTS.
The operation will also have repercussions in our country.
“A great operation that we greet with optimism”, commented Bruno Centonetti, Uilm national secretary. “And that we will not fail to monitor carefully, also because a fundamental asset has been delivered to Hitachi in Italy, that of rail transport which in Italy alone is worth more than 4,000 direct workers”, he concluded.
DETAILS OF THE OPERATION
The price of 1.66 billion euros corresponds to the corporate value, including debt, of the Thales unit, called Ground Transportation Systems (GTS). It reflects a 13.8-fold multiple of Ebit, Thales said in a note.
However, the final price of the transaction will be fixed at the end of the negotiation. The conclusion is expected to take place at the beginning of 2023, after the green light from the competent authorities.
HOW DOES THE TRANSPORT DIVISION GO?
Thales' GTS unit has approximately 9,000 employees in 42 countries. The railway activities generated revenues of 1.6 billion in 2020 equal to approximately 10% of the company's total revenues.
THE THALES STRATEGY
"With this important strategic move, we will be able to focus on developing our three high-tech long-term growth businesses, each of which can deliver double-digit margins in a sustainable way," said the president and CEO of Thales Patrick Caine. These three businesses are aerospace, defense and security, and digital identity and security.
THE GOAL OF THE JAPANESE GROUP
Through the purchase, Hitachi hopes to expand digitalization in the rail sector. The Japanese conglomerate above all hopes to increase its rail business revenue to 1 trillion yen ($ 9.17 billion) by fiscal year 2026.
Alistair Dormer, Hitachi's executive vice president, said that "the GTS business is extremely complementary geographically." GTS is headquartered in Germany, France and Canada.
Hitachi Rail's current trading bases are mainly in the UK, Italy, Japan and North America. And it is precisely in Italy that we are looking at the fallout of this operation.
THE COMMENT OF THE UILM
"Before toasting to the future we will need to know the operational and industrial development plans that are the basis of the agreement" said Bruno Cantonetti, Uilm national secretary and national manager of the sector. “The operation will be subject to the authorizations of antitrust and regulatory bodies but it gives us a photograph full of opportunities in terms of development, employment and market. With this acquisition Hitachi is a candidate to become the undisputed leader in "Turn-Key" solutions in all segments of rail transport, laying the foundations to become one of the players who will be able to lead the green transition of urban mobility and more generally of interoperability. of transport ".
WHAT HITACHI DID IN ITALY
"Hitachi in Italy – underlines Cantonetti – has already built strong synergies between signaling and train production and this will be the element that, combined with the skills expressed by workers and management, can become the engine that will further increase the contribution of our country in terms of industrial vision ".
"The GTS Division of Thales – he adds – will bring 9,000 people and the key to access important markets such as the French and German markets, which will benefit from the repercussions deriving from the national NRPs".
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/smartcity/perche-hitachi-comprera-le-attivita-ferroviarie-di-thales/ on Thu, 05 Aug 2021 06:26:24 +0000.