MHI Vestas Offshore Wind Established
- Business & Finance
Following the approval from all relevant authorities, MHI Vestas Offshore Wind has been formally established as of 1 April 2014.
The joint venture is responsible for the design, further development, procurement, manufacturing, installation, commissioning and service related to the V164-8.0 MW turbine as well as all marketing, sales and after-sales service related to offshore wind. Vestas and MHI have transferred a total of 380 employees to the new entity, which is owned equally by the parent companies.
Anders Runevad, CEO of Vestas Wind Systems A/S and Vice Chairman of MHI Vestas Offshore Wind, is confident about the future of the new joint venture and states: “The Offshore wind power industry is very challenging and it takes just the right combination of reliable and proven technology, experience, knowledge and track record to succeed.”
“Vestas and Mitsubishi Heavy Industries each hold invaluable experience and knowledge which makes this joint venture an ideal opportunity and a technologically and financially robust platform to obtain a global leadership position within offshore wind,” says Chairman of the Board of MHI Vestas Offshore Wind, Masafumi Wani.
From a financial perspective, the closing of the joint venture will only have a marginal impact on Vestas’ 2014 revenues and earnings due to the deconsolidation of the offshore business unit. A gain on the joint venture transaction of around EUR 50m will be booked as a special item.
Furthermore, the closing will have the following balance sheet impacts for Vestas as from 1 April 2014:
- a decrease in assets held for sale of EUR 350m as the V164 project and the offshore service order book are transferred to the joint venture,
- a decrease in liabilities directly associated with assets held for sale of EUR 203m as the offshore service order book is transferred to the joint venture,
- an increase in payables of EUR 51m primarily related to net project prepayments,
- an increase in investments in associates of EUR 198m as the joint venture will be treated as an associated company in Vestas’ accounts from the time of closing,
- an increase in cash at bank and in hand of EUR 50m as capex conducted from 1 September 2013 is reimbursed to Vestas and
- an increase in retained earnings of EUR 50m due to the expected gain on the joint venture transaction.
Management of MHI Vestas Offshore Wind
The Board of Directors of MHI Vestas Offshore Wind consists of representatives from both companies chaired by Masafumi Wani, Chairman of Mitsubishi Heavy Industries Europe, Ltd. Vice Chairman of the Board of Directors is Vestas CEO Anders Runevad.
“We are already seeing the benefits of building on the capabilities and offshore track record of Vestas and MHI’s long-standing presence in global power markets and within related technologies and we have received tremendous positive feedback from our customers on the establishment of the joint venture,” says Chief Executive Officer of MHI Vestas Offshore Wind, Jens Tommerup.
Press Release, April 01, 2014; Image: vestas