Bosch Offers $1.7 Billion For Ersol

Bosch has made a 1.1bn euro($1.7bn) takeover bid for Ersol, the German solar energy company, marking the first big move by one of the world's major industrial groups in this part of the renewable sector.

Bosch, the privately-owned German conglomerate, is offering &euro101 a share in cash, a 63 per cent premium to Ersol's closing price on Friday. Bosch has secured 50.1 per cent of the group through the &euro546m purchase of the stake held by Ventizz, a private equity firm.

The offer for Ersol is likely to be watched with interest by industrial groups. It, along with Conergy and Q-Cells, are the largest solar groups in the world.

Companies such as General Electric and Siemens have monitored the solar energy sector closely but apart from a few small purchases by GE, the large industrial companies have yet to act.

Some executives remain sceptical and believe that oversupply and a fall in subsidies could hit prices and margins.

However, Franz Fehrenbach, Bosch's chief executive, said the group – owned by a charitable foundation – wanted to add to its renewable energy activities, which included making wind turbines, thermal pumps and drives for marine power.

Bosch already makes solar collectors for hot-water generation and has a partnership with BASF and Heliatek, both of Germany, to produce cheaper organic photovoltaic cells used in the industry.

However the offer for Ersol, which had &euro160m in sales last year and is expected to have &euro300m this year, represents a significant increase.