Ming Yang Wind Power takes aim at Vestas

China’s largest wind turbine maker offers to buy the world’s largest wind turbine maker for up to US$1.97 billion.

Industry sources said Ming Yang Wind Power Group, Ltd. plans to offer up to US$1.97 billion to buy troubled Vestas Wind Systems A/S, the world’s largest wind turbine manufacturing.

Zhang Chuaiwei, chairman and CEO of Ming Yang, said the proposed takeover is part of a plan to diversify into other markets due to the weaker sales and revenues from wind turbines in China.

He noted that Ming Yang’s profit margins have fallen by more than 70% due to the wind sector’s slow growth this year. The supply of wind turbines is also increasing and these factors, said Zhang, means the wind power industry in China will continue to face difficulties and will see further reductions in newly installed capacity in 2012.

“Nevertheless, the unusually demanding conditions now prevalent in the industry may prompt further market consolidation, which we believe we will benefit from as a leading market player,” he said.

Chinese wind energy companies have been establishing bases in Europe and India to open more foreign markets for their products in response to the domestic slowdown and higher import taxes in the USA.

Ming Yang also has plans to move into India by buying a significant stake in the Reliance Group unit Global Wind Power, Ltd.

Vestas has been losing money this year in the face of tougher competition. Ming Yang is the largest private wind turbine manufacturer in China.