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ABB to spin off turbocharging division to focus on electrification

ABB to spin off turbocharging division to focus on electrification
Photo courtesy of ABB

ABB said it plans to spin off Accelleron (formerly ABB Turbocharging), its market-leading turbocharging division, that would allow ABB to simplify its portfolio and focus on the megatrends of electrification and automation. 

At the same time, Accelleron will be able to concentrate exclusively on reaching its full potential in the large engine industry where the company is known as the market leader in heavy-duty turbocharging, with a compelling growth profile, high cash generation and an attractive expected dividend policy.

ABB has four customer-​focused, globally leading businesses: Electrification, Industrial Automation, Motion, and Robotics & Discrete Automation.

​​Accelleron develops, produces and services turbochargers and large turbocharging components for engines, which enhance propulsion and increase fuel efficiency while reducing emissions. Its leading products support clients in sectors including marine, energy and rail, helping to provide sustainable and reliable power and highest efficiencies. Accelleron has an installed base of over 180,000 turbochargers globally and delivers around 10,000 turbochargers every year.

The turbochargers are produced, sold and serviced by Accelleron’s ∼2,200 employees across its network of 100 service stations in approximately 50 countries. The business has a significant and increasing presence in key established and growth markets in Asia.

Accelleron’s listing on SIX Swiss Exchange in Zurich is planned for October 3, 2022, and is subject to, among others, approval by ABB’s shareholders at an Extraordinary General Meeting (EGM) on September 7, 2022.

Provided that the spin-off is approved at the EGM and the conditions precedent for it are met, ABB will distribute to its shareholders, on a pro rata basis, as a dividend in kind, 1 Accelleron share for 20 ABB shares held. Further information on the transaction structure and other important dates in connection with the spin-off will follow in the invitation to the EGM and in the Shareholder Information Brochure prepared by ABB in relation to this process.

“After careful consideration involving a dual-track process, we have concluded that spinning off Accelleron is the best way forward – for Accelleron itself and for ABB’s shareholders. This decision also forms a key part of ABB’s active portfolio management, while allowing our shareholders to actively participate in the future growth of this Swiss champion,” said Björn Rosengren, chief executive officer of ABB.

“Through the spin-off, we will have an even greater focus on our own operations, meeting the critical high-power propulsion needs of our customers while enabling them to achieve their environmental targets. Our strong track record and financial profile position the business to be a leader in the energy transition, developing cutting-edge products and services – both now and far into the future; all while remunerating our shareholders,” said Daniel Bischofberger, CEO of Accelleron.

ABB has retained Credit Suisse and Goldman Sachs International as exclusive financial advisors on the transaction. Credit Suisse will be acting as listing agent.