Hansen Transmission Sells its Gearbox Production Unit to Cut Down Loss

Hansen Transmissions, a gear box manufacturing company located in Belgium and an auxiliary company of Suzlon Energy, has declared its intentions to vend its industrial gearbox manufacturing unit to Sumitomo Heavy Industries for a value of € 75 million. The division mainly manufactures gearboxes meant for use in wind turbines.

Currently the gear box division of Hansen is earning around 16% of the total revenue of the company. The completion of the transaction will make Hansen an exclusive green renewable energy products manufacturing company. Earlier the division had generated € 94 million during 2008-2009 and € 83 million during 2009-2010 financial year being 15.6% and 15.5% of the total sales made by the company in the respective year. The income raised out of the transaction will be utilized to clear the debts of the company. The company was having a total gear box manufacturing capability of 8,700 MW on September 30 and the company’s decision to terminate its gearbox manufacturing will bring down its production capability to 1,100 MW. The reduction while allowing the company to reduce its excess production capability also depicts the instability and insecurity of the global wind energy market undergoing presently.

Suzlon had taken on the management of Hansen in 2006 by paying $565 million. The company presently has around 26% capital investment in the company. Earlier Suzlon made attempts to sell Hansel eithert fully or a part of it to reduce its debt levels. The sales will lead to reconstituting its current staff level and will cut down its strength by 125. Currently the Gearbox division has 514 people in its role.