Siemens AG, EuropeÔÇÖs largest engineering company, has agreed to buy Israeli solar thermal power company Solel Systems for $418 million (Ôé¼280 million).
Beit Shemesh, Israel-based Solel is currently owned by Ecofin, a London, UK-based investment company, and another unnamed shareholder.
Solel, one of the worldÔÇÖs top two suppliers of solar receivers, achieved sales of almost $90 million (Ôé¼60 million) in the first half of this yearÔÇömore than double that of the same period a year previously. The company also carries out the design, development and construction of large solar thermal power plants.
Employing 500 people, the company has supplied solar fields in California, US, and is currently supplying new plants in Spain.
SolelÔÇÖs technology will also be used in the $555 billion (Ôé¼372 billion) Desertec project in the Sahara desert, being developed to bring electricity to European households.
Munich, Germany-based Siemens is keen to strengthen its portfolio of renewable energy products as countries attempt to move away from fossil fuels and find alternative ways of generating energy. The company has predicted that the solar energy market will grow by over 20 per cent per year going forward, with particular emphasis on development in the Middle East and Chile.
ÔÇ£After the rapid and highly successful expansion of our wind power business, we now want to continue this success story in the solar sector,ÔÇØ commented Siemens president and CEO, Peter L├Âscher. ┬á
ÔÇ£With the acquisition of Solel, Siemens can now strengthen its market position in the promising business of solar thermal power plants. We can thus further expand our extensive Environmental PortfolioÔÇöand, as already announced, we will become even greener.ÔÇØ
Avi Brenmiller, CEO of Solel Solar Systems, added: ÔÇ£Together, we will utilize our know-how in these core competencies to further optimize the water/steam cycle and to further boost the efficiency of solar thermal power plants.
ÔÇ£Thus we can accelerate the use of this clean technology. Combined with SiemensÔÇÖ financial strength and its global sales and marketing activities, this will open up promising prospects for our business and hence also for all of SolelÔÇÖs employees.ÔÇØ
Almost 25 per cent of SiemensÔÇÖ total revenue in 2008 came from products and technologies in its environmental unit, including wind turbines, steam turbines and technologies such as air pollution control. The company is currently the world leader in the solar thermal power plant steam turbine market, with 80 per cent market share.Siemens recently paid $15 million (Ôé¼10 million) for a stake in Israeli company Arava Power, which operates a solar energy plant at Kibbutz Ketura, which is situated north of Eilat. It is also planning to take a majority stake in Italian firm Archimede Solar Energy, in which it currently holds a 28 per cent stake.
Solel was set up in 1992 by former staff from the US-based maker of the first solar trough technology, Luz International.
The deal, which is subject to approval by regulators, is expected to close by the end of this year.
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