French energy company Areva said Thursday it was selling its stake in an offshore wind power unit to Gamesa, removing a key hurdle to the Spanish renewable energy group’s merger with German engineering giant Siemens.
“Following a 3-month competitive bidding process aimed at obtaining and assessing offers from potential third-party investors, the Board of Directors of AREVA S.A. decided to… sell its shares in Adwen to Gamesa,” the French company, whose primary business has been in nuclear energy, said in a statement.
Gamesa will pay 60 million euros ($67 million) to purchase Areva’s stake, a source familiar with the transaction told AFP.
Gamesa and Siemens announced in June plans to combine their wind power businesses to create one of the world’s largest makers of wind turbines.
A loose thread had been Adwen, the 50-50 percent joint venture between Areva and Gamesa in offshore wind power.
Areva was given three months to decide whether to sell its stake in Adwen or buy out Gamesa.
Gamesa’s deal with Siemens came after the company underwent a deep restructuring after the Spanish government slashed subsidies for electricity produced from renewable sources as it struggled to deal with a severe economic crisis.
The merger had been expected for months as Gamesa confirmed in January that it was in talks with Siemens to combine their wind activities, but it had been held up because of Gamesa’s joint venture with Areva.
Areva said that Gamesa was aware of Adwen’s commitments under tenders for offshore wind farms in France and those would be borne by Adwen.
The source said Gamesa could use if necessary a loan accorded by Areva of 230 million euros, which could possibly be increased by 100 million euros.
The sale will mean Areva’s exit from renewable energies. The company will focus on nuclear fuel after a restructuring of the French nuclear energy industry that will see EDF take over Areva’s reactor business.