AcLeap Power Inc. entered into an agreement to acquire Power Conversion division of ABB Ltd from ABB Ltd for $505 million on January 19, 2023. AcLeap Power Inc. will acquire Power Conversion division for aggregate consideration of $505 million in an all-cash deal. The transaction is expected to be funded by a combination of funding sources including corporate funds and debt financing.

The transaction is subject to regulatory approvals. Regulatory approvals required to be obtained for the transaction include United States (CFIUS) and Taiwan investment commission approvals. As on May 30, 2023, CFIUS and Taiwan investment commission approved the transaction.

The transaction is expected to close in the second half of 2023. The transaction will enable AcBel to strengthen its product portfolio, grow its customer base and enhance its local research development, manufacturing, commercial, and service capabilities in the United states. The estimated reasonable equity value of the Power Conversion division is in a range between $503 million and $556 million.

The purchase price is deemed fair. Power Conversion division generated revenues of approximately $440 million and Income from operations of approximately $54 million in 2022. Morgan Stanley acted as the exclusive financial advisor to AcBel.

Ching-Yang Lin, Brian E. Hamilton, Mehdi Ansari, Heather L. Coleman, Jameson S. Lloyd, Chris Beatty, Benjamin R. Walker and Juan Rodriguez of Sullivan & Cromwell LLP acted as the legal advisor to AcLeap Power Inc. and Covington & Burling LLP acted as the legal counsel in relation to the Committee on Foreign Investment in the United States (CFIUS) matters on the transaction to AcBel Polytech Inc. Citigroup Inc. (NYSE:C) acted as financial advisor and Milbank LLP acted as legal advisor to ABB Ltd. Meng-Ta Wu of Crowe Horwath (TW) CPAs, Investment Banking Arm provided independent expert opinion on the reasonableness of the share exchange ratio, cash or other assets allotted to shareholders in this merger and acquisition. Nancy Sun, Amanda Guo and Sunny Qin from Dentons served as legal advisor to AcBel Polytech.