TOKYO (APP) – Hitachi will buy the rail and traffic signal businesses of Italy’s Finmeccanica for an estimated $2.1 billion, reports said Tuesday, as the Japanese firm looks to expand overseas and challenge major international railways firms.
The Italian defence and aerospace company has agreed to sell its rail car unit AnsaldoBreda and Ansaldo STS, the world’s number two traffic signal company, to the vast Japanese conglomerate, according to reports by the leading Nikkei business daily and other major media.
The purchase is expected to be worth more than 250 billion yen ($2.1 billion), with Finmeccanica set to announce the agreement as early as Tuesday, the top-selling Yomiuri newspaper said.
“It is true that we are negotiating with Finmeccanica over the railway businesses, but the reported agreement has not been announced by our company,” a Tokyo-based Hitachi spokesman told AFP.
Shares in Hitachi fell 0.81 percent to 827.9 yen on the Tokyo Stock exchange Tuesday morning following the news reports.
Hitachi and three other companies stepped forward as prospective buyers after Finmeccanica announced plans last summer to unload the two subsidiaries.
The Japanese firm came close to sealing a deal last November, but a subsequent offer from a Chinese company delayed Finmeccanica’s final decision.
Under the reported deal, Hitachi plans to first acquire all shares held by Finmeccanica in the two companies and then make a tender offer to turn the Milan Stock Exchange-listed Ansaldo STS into a wholly owned subsidiary as well, the Nikkei said.
