ABB to buy 51% of Mitsubishi Electric's low-voltage unit for ¥79B

what happened

ABB has agreed to acquire a 51% stake in the low-voltage power distribution business that Mitsubishi Electric is carving out, for ¥79B (about $495M). The deal also includes an option to take full ownership and the related sales outside Japan.

According to the release distributed by eqs-news.com (EQS), the implied enterprise value is about $890M. That equates to an EV/Sales multiple of roughly 1.4x and an EV/EBITDA multiple of about 11.1x for fiscal 2025. The unit's FY2025 sales were ¥102B (about $640M), and ABB expects the deal to be EPS accretive after the first year.

Closing is planned for H2 2027 and depends on regulatory approvals. ABB targets an operating EBITA margin of 20% or more within five years.

why it matters

The deal strengthens ABB's electrification business in Japan and the wider Asia-Pacific region through a controlling stake. For investors, timing matters: delayed approvals would push back the earnings effect, and margin progress will depend on how well synergies materialize.

market impact

ABB: deeper presence in Japan and APAC via a control stake; earnings effect expected only after the 2027 closing.

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instruments