The business was quoted as having €44.8mn in sales in 2021. While the revenues for Gefran as a whole were up 17.2%, the motion control business posted growth of only 5.6% which resulted in net loss for the segment. According to the press release regarding this board meeting, the motion control business was performing poorly relative to the rest of Gefran. Gefran, an Italian supplier of automation equipment, had reclassified the motion control business as ‘disposal group held for sale’ in a board meeting on June 30th of this year. WEG announced on August 6th, that the company would be acquiring Gefran’s motion control business for €23mn. WEG acquires Gefran’s motion control business in opportunistic move to acquire local capacity This acquisition also gives ABB additional capacity from a manufacturing facility in Mexico which will bring welcomed flexibility amongst supply chain woes.
We estimate this acquisition would put ABBs share of the NEMA market between 35 to 40% which is significantly higher than the nearest competitor. This move allows Siemens to focus on maintaining this cash cow status in its core IEC markets as opposed to trying to compete with WEG, NIDEC, and ABB for expansion within the NEMA space.ĪBB on the other hand, continues to build upon its share of the NEMA market with this acquisition. The motors business is still important for Siemens as it generates a significant amount of revenue (~1bn), however it would appear that this business is moving more towards cash cow status as opposed to being an area of focused expansion. The sale of the NEMA division represents an effort by Siemens to exit markets non-essential to this strategy. All the while, Siemens has stated its intent to refine its portfolio to become a technology focused company. Over the last year, Siemens has announced several initiatives aimed at building out its capabilities in this area including a partnership with NVIDIA and multiple acquisitions in the predictive maintenance and asset management space.
#WEG SPLITT SOFTWARE#
For years, Siemens has taken steps to transition its focus away from being an industrial components supplier towards being a provider of industrial digitalization software and services. While only a small portion of Siemens’ overall motor business, the sale of its NEMA division does lend perspective on the direction Siemens is headed. By our estimates, the NEMA portion of Siemens’ business only represented ~6% of its total low voltage motor business. While Siemens is the market leader in Europe, an IEC market, our estimates suggest the company holds only the 6th position in the Americas market. NEMA is a North American standard, with the rest of the world abiding by IEC standards.ĭespite being the second largest motor manufacturer in the world, Siemens’ presence in the Americas, a predominantly NEMA frame market, is relatively small. Within the motor market, there are two sets of standards for motor frame size and efficiency: NEMA (National Electrical Manufacturers Association) and IEC (International Electrotechnical Commission). The acquisition of Baldor Electric not only gave ABB the title of market leader within low voltage industrial motors, it also meant they were now the largest supplier of NEMA frame motors. At the time, Baldor Electric was the largest supplier of electric motors within North America. In 2011, the company finalized its acquisition of Baldor Electric. In this insight, we’ll unpack both of these acquisitions and explain their implications on the broader motor and drives markets.ĪBB acquires Siemens’ NEMA motor businessĪBB has long used acquisition as a tool to bolster its motor portfolio. Both developments are significant within the motor and drives market and serve to highlight portions of each company’s industrial automation strategy. Then, on Aug. 11, ABB announced its acquisition of Siemens’ NEMA motor business. First, WEG announced its acquisition of Gefran’s motion control business. The top three suppliers of low voltage AC motors made waves in the motor and drives space with a string of acquisition announcements in early August. Acquisitions by WEG and ABB Reveal Strategies Amongst Motor Suppliers In this insight, we’ll unpack both of these acquisitions and explain their implications on the broader motor and drives markets. Then ABB announced its acquisition of Siemens’ NEMA motor business. WEG announced its acquisition of Gefran’s motion control business.
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