Mitsubishi Heavy Industries, Ltd. to Acquire Industrial Power Generation Company Pratt & Whitney Power Systems

LAKE MARY, Fla., Dec. 12, 2012 /PRNewswire/ -- Mitsubishi Heavy Industries, Ltd. (MHI) has concluded an agreement with United Technologies Corporation (UTC) of the U.S. under which MHI will acquire Pratt & Whitney Power Systems (PWPS), the small and medium-size gas turbine business unit of Pratt & Whitney (P&W), an aeroengine manufacturer. MHI and UTC, P&W's parent company, signed the agreement earlier this week.

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PWPS engages primarily in the engineering, assembly and sales of aero-derivative gas turbines and also provides gas turbine services and engineering, procurement and construction services of related power generation systems. The company has approximately 430 employees.  PWPS owns a majority share of Turboden s.r.l. of Italy, a manufacturer of Organic Rankine Cycle (ORC) turbines, which will also be included as part of the acquisition.   

MHI, which has focused its gas turbine business principally on large-capacity, high-efficiency systems, will significantly diversify its power generation product portfolio with the acquisition of PWPS. PWPS's aero-derivative gas turbines have been highly acclaimed, especially for emergency power generation applications, for their compact design and rapid start-up time, with over 1,700 units delivered to date worldwide. Going forward, significant growth is anticipated in applications requiring a flexible power source complementary to a renewable-energy power source.  Robust market demand is also expected as small power sources for application in emerging markets. PWPS's main products to date have been 30MW (megawatt) class machines, but currently the company is developing new 60MW class models, which are expected to boost PWPS's market share significantly.

PWPS US operations will be aligned with Mitsubishi Power Systems Americas, Inc. (MPSA), headquartered in Lake Mary, Florida. MPSA President Koji Hasegawa, stated, "The PWPS business offers tremendous synergy with our existing US operations.  It significantly diversifies our equipment offering and compliments the scope of our service business." 

Turboden's ORC turbines have the capability to generate power or supply hot water using a relatively low-temperature heat source, e.g. biomass, factory waste heat or geothermal energy. Until now the company has sold more than 300 units in 20 countries, primarily in Europe. In Japan, increasing opportunities are emerging to use this technology in biomass and geothermal applications.  

In its gas turbine business, MHI is presently establishing a global structure to substantially increase manufacturing capacity of large high temperature, high-output gas turbines annually. In addition to output from its Takasago Machinery Works in Japan, shipments have now also begun from MPSA's Savannah Machinery Works, a new gas turbine manufacturing and service facility located in Pooler, Georgia. With the addition of flexible and reliable small and medium-size offerings to its product portfolio through the acquisition of PWPS, MPSA will now be able to meet broader customer needs through combinations of those units and high-efficiency machines.

Going forward, MHI intends to further strengthen its marketing activities for gas turbines, which offer clear benefits in terms of efficient energy usage and reduction of environmental burdens, leveraging the merits of both large-capacity and aero-derivative gas turbines as well as their synergy effects.

About Mitsubishi Heavy Industries

Mitsubishi Heavy Industries, Ltd. (MHI), headquartered in Tokyo, Japan, is one of the world's leading heavy machinery manufacturers, with consolidated sales of 2,820.9 billion yen in fiscal 2011, the year ended March 31, 2012. MHI's diverse lineup of products and services encompasses shipbuilding, power plants, chemical plants, environmental equipment, steel structures, industrial and general machinery, aircraft, space systems and air-conditioning systems.

For many years MHI and P&W have been in a collaborative relationship in aeroengine production, including recent joint development of the new jet engine for the Mitsubishi Regional Jet. After acquisition of PWPS, we will maintain our collaborative relationship in the supply of engine parts for gas turbines and development of new machines as MHI targets expansion in aero-derivative gas turbine business.

In its 2012 Medium-Term Business Plan, a comprehensive three-year plan launched this fiscal year, MHI set a basic policy calling for full utilization of its strengths and synergy effects through consolidation and restructuring of all operations into four business domains – "Energy & Environment" and "Defense & Aerospace," for example – and to accelerate global business development in a quest to expand its business scale to the 5 trillion yen level. Among the four business domains, the company now considers Energy & Environment of highest importance, and its new business plan calls for concentrated investment of management resources into this area as a way of achieving business scale expansion rapidly. The acquisition of PWPS falls in line with this initiative.

For more information, please visit the MHI website (http://www.mhi.co.jp/en/index.html).

About Mitsubishi Power Systems Americas, Inc.

Mitsubishi Power Systems Americas, Inc. (MPSA) was established in 2001 and is headquartered in Lake Mary, Florida with key operations in Orlando, FL, Savannah, GA, Newport Beach, CA, and Houston, TX. MPSA provides a wide variety of products and services for the electric power generation industry including gas, steam, wind and geothermal turbines, boilers, and selective catalytic reduction systems.  The company's ultimate parent is Mitsubishi Heavy Industries, Ltd. (MHI), a diversified Fortune "Global 150" company with more than $30 billion in annual revenues and 40,000 employees worldwide. MHI is an international leader in the design and supply of energy, aerospace, machinery, transportation, and environmental systems and equipment.

SOURCE Mitsubishi Heavy Industries, Ltd.

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