SEOUL, South Korea--(BUSINESS WIRE)--“Now we are ready to provide products to customers in the United States in time through our local manufacturing facilities. And we will strengthen our position as a total energy solution provider by providing circuit breakers, ESSs and STATCOMs, in addition to high voltage transformers,” said Chairman Cho Hyun-joon of Hyosung Group.
Hyosung Heavy Industries (KRX:298040) has obtained the first production base in the United States to increase its presence in the world’s largest electric power market.
Hyosung Heavy Industries announced on December 16 that it has acquired Mitsubishi Electric Power Products, Inc. (MEPPI)'s high voltage transformer plant in the US state of Tennessee for 46.5 million dollars (approximately KRW 50 billion).
At the Memphis plant, MEPPI has been producing transformers, but since the first half of next year, Hyosung Heavy Industries will convert the facility to manufacture core-type high voltage transformers that can be widely used in a range of industries. Core-type transformers account for 95% of demands in the global transformer market, including North America.
The acquisition of the MEPPI Memphis plant will assist Hyosung in meeting the growing demand for core-type transformers, with continued increase in power consumption, expansion in renewable energy industry and growing demand for replacement of power devices due to deterioration of existing power infrastructure.
In addition, Hyosung Heavy Industries is acquiring the plant to establish a presence in the United States and to avoid high costs associated with tariffs.
The US high voltage transformer market is worth about KRW 2 trillion. Since entering the US market in 2001, Hyosung Heavy Industries has maintained long-term partnerships with leading US power companies.
When the plant in Tennessee operates in full scale, the company will reinforce the role of its plant in Changwon, the main manufacturing facility in Korea, as the global technology development center, while focusing on manufacturing products for premium markets including Europe and those for the Middle East and Asian markets.