COPENHAGEN (Reuters) - Danish wind turbine maker Vestas Wind Systems (VWS.CO) is to sell a tower factory in Denmark to Chinese group Titan Wind Energy (002531.SZ) for an undisclosed sum, allowing the world’s biggest wind turbine maker to cut costs.
“Our new towers facility here in Denmark increases our possibilities of servicing and expanding our global customer base,” Yan Junxu, founder and chief executive of Titan Wind Energy, said on Wednesday.
“Europe is the region that offers the most promising outlook for the development of offshore wind energy,” Junxu said.
The wind power industry has been hit by overcapacity, rising costs and cutbacks in support for renewable energy by governments trying to plug deficits.
The deal came ahead of a state visit by Chinese President Hu Jintao to Denmark on Thursday. Titan Wind Energy is China’s biggest manufacturer of wind turbine towers, with annual production capacity of 1,600 towers.
Vestas said the deal to sell the factory, which has 120 employees, was signed on Tuesday and should be approved by Chinese authorities shortly.
Last month, Vestas reported a larger than expected first-quarter loss due to delayed deliveries and rising costs.
Vestas shares were up 0.6 percent at 03:53 a.m. EDT (753 GMT), compared with a 0.3 percent higher Copenhagen benchmark index .OMXC20.
Reporting by Mette Fraende; Editing by Dan Lalor