Danish co to stay out of REpower bid war

Danish co to stay out of REpower bid war
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First Published: Wed, Mar 21 2007. 12 41 AM IST
Updated: Wed, Mar 21 2007. 12 41 AM IST
Copenhagen: Shares in Denmark’s Vestas, the world’s top wind-turbine maker have climbed more than 20% this year, boosted last month when the company raised its 2006 guidance and bolstered by a bidding war between India’s Suzlon Energy Ltd and France’s Areva for German competitor REpower.
The company swung back to a full-year profit last year even as global warming concerns boosted demand for wind, wave and solar power to combat greenhouse gas emissions.
Vestas, which started manufacturing wind turbines in 1979, unveiled a 2006 operating profit of €201 million (Rs1176.6 crore) on Tuesday, compared with a 2005 loss of €116 million before interest and taxes.
Despite the tangential benefit of the REpower issue, the company’s chief executive Ditlev Engel said Vestas had no plan to join the bidding war for the German rival.
“We have no plans to interfere,” the CEO said, adding he expected more competitors to enter the growing market to capitalize on the growth rather than further consolidation.
India’s Suzlon Energy Ltd and French nuclear-reactor maker Areva are both bidding for the German turbine maker REpower.
The Jutland-based firm, with plants in Denmark, Germany, India, Italy, Britain, Spain, Sweden, Norway, Australia and China, maintained its 2007 sales and margin outlook, forecasting sales at about €4.5 billion with an operating margin of 7-9%.
Sales last year rose 7.5% to €3.85 billion, but component shortages continued to hamper production. It said it would again face long and expensive key-component delivery times this year.
Scientists say average global temperatures will rise by between 1.8 and 4 degrees Celsius this century due to carbon gas emissions from burning fossil fuels for power and transport, putting millions of lives at risk from floods and famines.
Earlier this month, the European Union’s 27 leaders committed themselves to a target of reducing EU greenhouse gas emissions, blamed for heating the planet, by 20% by 2020 and offered to go to 30% if major nations follow suit.
Engel applauded the EU’s plans to reduce emissions, saying Denmark was a shop window on how to achieve the targets.
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First Published: Wed, Mar 21 2007. 12 41 AM IST
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