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12 THE JOURNAL OF COMMERCE www.joc.com JULY 2016 THE MERGER OF Germany's Siemens and Spain's Gamesa into the world's biggest builder of wind farms is the latest in a series of mergers and acquisitions in a sector that has become a top source of project cargo shipments. Siemens agreed to pay 1 billion euros ($1.13 billion) for a 59 percent majority stake in the combined company. The deal meshes Siemens' strength in offshore wind power with Gamesa's leading posi- tion in developing markets. "Although some degree of cannibalization is to be expected as the two companies unite their wind businesses, the new combined venture will indeed surface as a lead- ing global wind turbine manufacturer in terms of annual installation volumes," said Magnus Dale, senior analyst of European power, gas, coal and renewables at IHS Energy. The merger follows other industry consolidation, including the merger of Nordex and Acciona Windpower, which was approved in January, and GE. The new company will have the world's largest market share in wind power manufacturing, surpassing China's Gold- wind and Denmark's Vestas. Combined turbine installations of Siemens and Gamesa in 2015 would yield 8.1 million gigawatts in 34 markets globally, accord- ing to IHS Energy, which, like The Journal of Commerce, is owned by IHS. The Siemens-Gamesa venture's instal- lations last year would rank slightly ahead of Goldwind, but the new company will have much broader coverage than the Chinese company, which remains almost fully dependent on its home market for sales. Vestas had 7.4 million gigawatts of installations in 34 countries last year. Siemens' wind power business has a strong position in North America and northern Europe. Gamesa is strongest in fast-growing emerging markets such as India and Latin America, and southern Europe. A key unanswered question follow- ing the Siemens-Gamesa deal is what will happen with Adwen, the offshore wind joint venture that Gamesa currently owns with Areva. Options include Areva taking full ownership of the venture, the By Joseph Bonney WINDS OF COMPETITION Siemens-Gamesa merger creates world's biggest builder of wind energy farms