The High Voltage Direct Current (HVDC) Transmission Market 2013-2023

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Contents
1. Executive Summary
1.1 The Global HVDC Market Overview 1.2 Benefits of This Report 1.3 Who is This Report For? 1.4 Methodology 1.5 Global HVDC Transmission Market Forecast 2013-2023 1.6 Regional HVDC Transmission Market Forecasts 2013-2023

2. Introduction to the HVDC Transmission Market

2.1 HVDC Transmission Market Definition 2.2 HVDC Transmission Market Structure Overview 2.3 Types of HVDC Transmission Project 2.4 Brief History of HVDC Transmission

3. Global HVDC Transmission Market Forecast 2013-2023

3.1 Environmental Considerations 3.2 Reducing Greenhouse Gas Emissions 3.3 HVDC Circuit Breakers A HVDC Transmission Game Changer 3.4 HVDC versus Gas Transport Solutions 3.5 Large Scale Solar Integration Possibilities 3.6 Grid Management and Renewables Integration 3.7 Vast Distance Transfers 3.8 Energy Security 3.9 Power Balancing and Investment Decision Vulnerability 3.10 Underground versus Overground 3.11 Global HVDC Transmission Market Drivers & Restraints 3.12 Advantages and Disadvantages of HVDC Transmission 3.12.1 Advantages 3.12.2 Disadvantages 3.13 HVDC Back-to-Back (B2B) Stations

4. Regional HVDC Transmission Markets 2013-2023

4.1 Regional HVDC Transmission Markets Share Forecast 2013-2023 4.2 Barriers to Entry Analysis for Regional HVDC Transmission Markets 4.3 The Asian HVDC Transmission Market 2013-2023 4.3.1 Asian HVDC Transmission Market Drivers & Restraints 4.3.2 Chinese HVDC Outlook 4.3.3 Indian HVDC Outlook 4.3.4 Sri Lankan HVDC Outlook

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4.3.5 South Korean HVDC Outlook 4.3.6 Asian HVDC Transmission Projects & Upgrades Planned or Under Construction 4.4 European HVDC Transmission Market Forecast 2013-2023 4.4.1 European HVDC Transmission Market Drivers & Restraints 4.4.2 Southern European Outlook 4.4.3 UK and Ireland Outlook 4.4.4 Western and Central European and Scandinavian Outlook 4.4.5 Desertec and Other HVDC Grid Propositions 4.4.6 European HVDC Transmission Projects & Upgrades Planned or Under Construction 4.5 North American HVDC Transmission Market Forecast 2013-2023 4.5.1 North American HVDC Transmission Drivers & Restraints 4.5.2 Canadian HVDC Outlook 4.5.3 US HVDC Transmission Outlook 4.5.4 North American HVDC Transmission Projects & Upgrades Planned or Under Construction 4.6 South American HVDC Transmission Market 2013-2023 4.6.1 South American HVDC Transmission Drivers & Restraints 4.6.2 South American HVDC Transmission Projects & Upgrades Planned or Under Construction 4.7 African HVDC Transmission Market 2013-2023 4.7.1 African HVDC Transmission Market Drivers & Restraints 4.7.2 Renewables Potential 4.7.3 North African HVDC Outlook 4.7.4 DRC Hydropower and African Power Demands 4.7.5 Development Finance 4.7.6 African HVDC Transmission Projects & Upgrades Planned or Under Construction 4.8 South East Asian and Oceanian HVDC Transmission Market 2013-2023 4.8.1 South East Asian and Oceanian HVDC Transmission Drivers & Restraints 4.8.2 South East Asian and Oceanian HVDC Transmission Projects & Upgrades Planned or Under Construction

5. PEST Analysis of the HVDC Transmission Market 2013-2023 6. Expert Opinion

6.1 Europacable 6.1.1 Europacable Objectives 6.1.2 Common Points of Contention for the European HVDC Market 6.1.3 Undergrounding 6.1.4 Permitting for HV Cables in Europe 6.1.5 Exciting European HVDC Projects 6.1.6 HVDC Circuit Breaker 6.1.7 Cable Supply Capabilities 6.1.8 Cable Specification Capabilities 6.1.9 Limitation of Investment in Europe 6.1.10 HVDC Market Outside of Europe 6.2 Statnett 6.2.1 Statnett and HVDC

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6.2.2 Nordic and Northern European HVDC Outlook 6.2.3 Statnett HVDC Capital Expenditure Commitment 6.2.4 Sydvestlinken Project Update 6.2.5 Nordic HVDC Transmission Drivers 6.2.6 Constraints on HVDC Transmission Capital Expenditure

7. Leading Companies in the HVDC Transmission Market

7.1 Leading HVDC Transmission Component Suppliers 7.1.1 ABB Overview 7.1.1.1 Analysis and Future Outlook 7.1.1.2 M&A Activity 2013 7.1.1.3 Regional Emphasis / Focus 7.1.2 Siemens Overview 7.1.2.1 Analysis and Future Outlook 7.1.2.2 M&A Activity 7.1.2.3 Regional Emphasis / Focus 7.1.3 Alstom Overview 7.1.3.1 Analysis and Future Outlook 7.1.3.2 Regional Emphasis / Focus 7.2 HVDC Cable Manufacturers 7.2.1 Prysmian Overview 7.2.1.1 Analysis and Future Outlook 7.2.2 Nexans Overview 7.2.2.1 Analysis and Future Outlook 7.3 Other Leading Companies in the HVDC Transmission Market

8. Conclusions
8.1 Global HVDC Transmission Market Outlook 8.2 Global HVDC Transmission Drivers & Restraints 8.3 Regional HVDC Transmission Market Forecasts 2013-2023

9. Glossary

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List of Tables
Table 1.1 Regional HVDC Transmission Market Forecasts Summary 2013, 2018, 2023 (CAPEX ($m), CAGR %) Table 3.1 Global HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative) Table 3.2 Global HVDC Transmission Market Drivers & Restraints Table 3.3 Back-to-Back HVDC Stations Planned or Under Construction (Name, Location, MW, Commission Date, Component Supplier) Table 4.1 Regional HVDC Transmission Markets Forecast 2013-2023 ($m, AGR %) Table 4.2 Asian HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative) Table 4.3 Asian HVDC Transmission Market Drivers & Restraints Table 4.4 Chinese Electricity Demand (Population, Population Growth Rate, Y-O-Y Electricity Demand Growth, Economic Growth) Table 4.5 Indian Electricity Demand (Population, Population Growth Rate, Y-O-Y Electricity Demand Growth, Economic Growth) Table 4.6 Asian HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Type, HVDC Lead, Location, Sponsor, Status) Table 4.7 Asian HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Est. Cost ($m), Voltage (kV), Power Rating (MW), Length (km)) Table 4.8 European HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative) Table 4.9 European HVDC Market Drivers & Restraints Table 4.10 European HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Type, HVDC Lead, Location, Sponsor, Status) Table 4.11 European HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Est. Cost ($m), Voltage (kV), Power Rating (MW), Length (km)) Table 4.12 North American HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative) Table 4.13 North American HVDC Transmission Market Drivers & Restraints Table 4.14 North American HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Type, HVDC Lead, Location, Sponsor, Status) Table 4.15 North American HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Cost ($m), Voltage (kV), Power Rating (MW), Length (km)) Table 4.16 South American HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative) Table 4.17 South American HVDC Transmission Market Drivers & Restraints Table 4.18 South American HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Type, HVDC Lead, Location, Cost, Sponsor, Status) Table 4.19 South American HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Cost ($m), Voltage (kV), Power Rating (MW), Length (km)) Table 4.20 African HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative) Table 4.21 African HVDC Transmission Market Drivers & Restraints Table 4.22 African HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Type, HVDC Lead, Location, Cost, Sponsor, Status) Table 4.23 African HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Cost ($m), Voltage (kV), Power Rating (MW), Length (km)) Table 4.24 South East Asian and Oceanian HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative) Table 4.25 South East Asian and Oceanian HVDC Transmission Market Drivers & Restraints Table 4.26 South East Asian and Oceanian HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Type, HVDC Lead, Location, Cost, Sponsor, Status)

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Table 4.27 South East Asian and Oceanian HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Cost ($m), Voltage (kV), Power Rating (MW), Length (km)) Table 5.1 PEST Analysis of the HVDC Transmission Market 2013-2023 Table 7.1 Leading HVDC Transmission Component Suppliers (Rank, Company, Total Revenue, Revenue from HVDC Transmission ($m), Share of HVDC Projects) Table 7.2 ABB Overview (Total Revenue 2012, Revenue from Confirmed HVDC Transmission Projects, Share of HVDC Transmission Projects, HQ, Ticker, IR Contact, Website) Table 7.3 ABB Confirmed HVDC Transmission Projects (Project, Type, Location, Lead Sponsor, Status) Table 7.4 ABB Confirmed HVDC Transmission Projects (Project, Estimated Cost ($m), Voltage, Power Rating, Length) Table 7.5 Siemens Overview (Total Revenue FY2012, Revenue from Confirmed HVDC Transmission Projects, Share of HVDC Transmission Projects, HQ, Ticker, IR Contact, Website) Table 7.6 Siemens Confirmed HVDC Transmission Projects (Project, Type, Location, Lead Sponsor, Status) Table 7.7 Siemens Confirmed HVDC Transmission Projects (Project, Estimated Cost ($m), Voltage, Power Rating, Length) Table 7.8 Alstom Overview 2012 (Total Sales 2012-2013 FY, Revenue from Confirmed HVDC Transmission Projects, Share of HVDC Transmission Projects, HQ, Ticker, IR Contact, Website) Table 7.9 Alstom Confirmed HVDC Transmission Projects (Project, Type, Location, Lead Sponsor, Status) Table 7.10 Alstom Confirmed HVDC Transmission Projects (Project, Estimated Cost ($m), Voltage, Power Rating, Length) Table 7.11 Prysmian Overview 2012 (Total Company Sales 2012, HQ, Ticker, IR Contact, Website) Table 7.12 Nexans Overview 2012 (Total Revenue, HQ, Ticker, IR Contact, Website) Table 7.13 Other Leading Cable and Equipment Manufacturers in the HVDC Transmission Market (Company, Product/Service) Table 7.14 Other Leading Stakeholders in the HVDC Transmission Market (Company, Involvement in HVDC Transmission Market) Table 8.1 Global HVDC Transmission Market Drivers & Restraints Table 8.2 Regional Market Forecasts Summary 2013, 2018, 2023, CAPEX ($m), 2013-2023 CAGR (%)

List of Figures
Figure 2.1 Global HVDC Transmission Market Structure Overview Figure 3.1 Global HVDC Transmission Market Forecast 2013-2023 ($m, AGR%) Figure 3.2 HVDC Transmission Distance Added, China & RoW, Year of Completion 2013-2018 (km) Figure 3.3 Cost Comparison Relationship HVAC vs. HVDC Figure 4.1 Regional HVDC Transmission Markets Forecast 2013-2023 ($m) Figure 4.2 Regional and Global HVDC Markets CAGR% (2013-2018, 2018-2023, 2013-2023) Figure 4.3 Regional HVDC Transmission Markets Share Forecast 2013 (%) Figure 4.4 Regional HVDC Transmission Markets Share Forecast 2018 (%) Figure 4.5 Regional HVDC Transmission Markets Share Forecast 2023 (%) Figure 4.6 Regional HVDC Transmission Market Share Change, 2013-2023 (%) Figure 4.7 Regional HVDC Transmission Market Shares, 2013-2023 (%) Figure 4.8 Barriers to Entry vs. National Market Size vs. CAGR% 2013-2023 ($m, CAGR%) Figure 4.9 Asian HVDC Transmission Market Forecast 2013-2023 ($m, AGR%) Figure 4.10 Asian HVDC Market Share Forecast 2013, 2018 and 2023 (% Share) Figure 4.11 HVDC Transmission Distance Added in China (km), Year of Completion, 2013-2018 Figure 4.12 Percentage of HVDC Transmission Added by Distance, China vs. RoW (%)

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Figure 4.13 Yangtze River Dams Completed, Planned and Under Construction (excluding tributary projects), (Distance from Mouth (km), Elevation (metres)) Figure 4.14 European HVDC Transmission Market Forecast 2013-2023 ($m, AGR %) Figure 4.15 European HVDC Transmission Market Share Forecast 2013, 2018 and 2023 (% Share) Figure 4.16 Average HVDC Transmission Cost per km, RoW, EU & Asia ($m) Figure 4.17 North American HVDC Transmission Market Forecast 2013-2023 ($m, AGR %) Figure 4.18 North American HVDC Market Share Forecast 2013, 2018 and 2023 (% Share) Figure 4.19 Estimated Levelised 2018 Cost of New Power Generation, US ($/MWh) Figure 4.20 Map of Hawaii Channel Depth and Telecommunication Cables Figure 4.21 South American HVDC Transmission Market Forecast 2013-2023 ($m, AGR %) Figure 4.22 South American HVDC Market Share Forecast 2013, 2018 and 2023 (% Share) Figure 4.23 African HVDC Transmission Market Forecast 2013-2023 ($m, AGR %) Figure 4.24 African HVDC Market Share Forecast 2013, 2018 and 2023 (% Share) Figure 4.25 Sub-Saharan GDP Growth Rates, 2005-2011 (% Change) Figure 4.26 South East Asian and Oceanian HVDC Transmission Market Forecast 2013-2023 ($m, AGR %) Figure 4.27 South East Asian and Oceanian Market Share Forecast 2013, 2018 and 2023 (% Share) Figure 4.28 Indonesia, Malaysia & Philippines GDP per Capita, Purchasing Power Parity, AGR (%), 2005-2011; GWh Consumption, 2009 Figure 7.1 Leading Companies in the HVDC Transmission Market Figure 7.2 HVDC Component Suppliers Share of Confirmed HVDC Transmission Projects (%) Figure 7.3 HVDC Transmission Project Averages Cost ($m), Voltage (kV), Power Rating (MW) by Component Supplier Figure 8.1 Regional HVDC Transmission Markets Forecast 2013-2023 ($m) Figure 8.2 Regional and Global HVDC Markets CAGRs % (2013-2018, 2018-2023, 2013-2023) Figure 8.3 Regional HVDC Transmission Market Shares, 2013-2023 (%)

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Companies Mentioned in This Report
50Hertz ABB Abengoa Group Adani Group Agder Energi Alstom AltaLink Amprion AMSC APS Technology Group Atco Electric Atlantic Wind Connection Borealis Bregal Energy Inc C-EPRI China Southern Power Grid Company Clean Line Energy Partners LLC C.N.T.E.E. Transelectrica S.A. Colbun DEH Quantum Energy Desertec Draka Duke American Transmission Company E-CO Energi EDF EDF Trading EGL (Elektrizitts-Gesellschaft Laufenburg) Egypt Electricity Transmission Company Eirgrid Electrabel Electrical Interconnection Company Colombia-Panama SA Electricidade de Moambique (EDM) Electrobras Element Power Elering Eletronorte Eletrosul Elia Emera EnBW ENEL Endesa Group Energinet.dk ENL Maritime Link Inc Eskom Ethiopian Electric Power Corporation

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Eurotunnel Fingrid Fujikura Furukawa Electric Google Hidroelctrica De Cahora Bassa Hudson Transmission Partners, LLC Invensys Israel Electric Corporation KfW Korea Electronic Power Corporation (KEPCO) Kraftnat Aland Lapp Landsvirkjun LITGRID Los Gatos Research LS Cable & System Lyse (Lyse Energi) Manitoba Hydro Marunbeni Corp. Mitsubishi Corporation Moncado Energy Group Nalcor Energy National Grid Corp of the Philippines (NGCP) National Grid (UK) Nexans Northeast Utilities Norte Brasil Transmissora de Energia Norte Energia consortium Northern Pass Transmission LLC NSTAR Nur Energie PLN (Perusahaan Listrik Negara) Polish Transmission System Operator (TSO) PSE Operator S.A Powergrid Corporation of India Power-One PPC Renewables Prysmian Red Electrica de Espaa REN RTE (Rseau de Transport d'lectricit) Saudi Electric Company Scottish Power Scottish and Southern Energy (SSE) Siemens Socit Nationale d'lectricit Sonelgaz

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SNC-Lavalin State Grid Corporation of China (SGCC) Statnett Statoil Star Capital Partners STEG (Socit Tunisienne de lElectricit et du Gaz) Svenska Kraftnt TenneT B.V. TERNA Toshiba Transcanada Corp Transelec Transpower New Zealand TSO Cyprus Vattenfall UK Westcor Company

Government Agencies and Other Organisations Mentioned in This Report

African Development Bank Alberta Utilities Board Bonneville Power Administration (BPA) Bureau of Ocean and Energy Management Ceylon Electricity Board Electricity Authority of Cyprus EIA US Energy Information Agency Europacable German Ministry of Environment International Monetary Fund (IMF) MIT Massachusetts Institute of Technology National Development and Reform Commission (NDRC) China National Oceanic and Atmospheric Administration (NOAA) Norwegian Ministry of Petroleum and Energy Politecnico di Milano United Nations Educational, Scientific and Cultural Organisation (UNESCO) US Department of Energy (DoE) World Bank

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The High Voltage Direct Current (HVDC) Transmission Market 2013-2023

4.4.6 European HVDC Transmission Projects & Upgrades Planned or Under Construction
The below Tables 4.10 and 4.11 detail the HVDC transmission projects that are currently planned or are in construction within Europe. The status column of Table 4.10 should be regarded as the most important as it indicates the likelihood of the project preceding and the earliest date of operation.

Table 4.10 European HVDC Transmission Projects & Upgrades Planned or Under Construction (Project, Type, HVDC Lead, Location, Sponsor, Status)
Project Underground/ Subsea/ Overground Albania- Italy HVDC Link Kriegers Flak Underground/ Subsea HVDC Voltage Source Convertor HVDC Lead (if confirmed) AlbaniaItaly Baltic Sea Moncado Energy Group Energinet, 50Hertz On Hold - Denied Landing Rights in Italy Political approval and consultation occurred in 2012. Earliest operation 2016. Nemo Subsea BelgiumUK National Grid, Elia FID to be made in 2013. Commission expected 2017/18 Alegro Overground BelgiumGermany Skagerrak 4 Underground/ Subsea ABB/ Nexans/ Prysmian Cobra Subsea DenmarkHolland Energinet, TenneT DenmarkNorway Stattnet/ Energinet Elia Commission expected in 20172018. Commissioning of project is scheduled for 2014. FID due 2014. Construction is expected to begin Location Lead Sponsor(s) (if confirmed) Status

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4.6 South American HVDC Transmission Market 2013-2023
Table 4.16 and Figures 4.21 and 4.22 show visiongains forecast for capital expenditure on HVDC transmission in South America over the next 10 years.

Table 4.16 South American HVDC Transmission Market Forecast 2013-2023 ($m, AGR %, CAGR%, Cumulative)
2012 AGR CAGR (%) 2013-18 CAGR (%) 2013-23 2013 0.0 2014 3.0 2015 20.3 3.5 2016 -9.6 2017 2.8 -3.9 2018 2019 2020 2021 11.3 -10.7 2022 11.7 2023 2013-23 12.0 CAPEX ($m) 885.0 885.0 911.7 1,096.7 991.7 1,019.4 1,051.3 648.0 428.6 477.1 532.9 597.1 8,639.5 3.1 -38.4 -33.9 2018-23

Source: Visiongain 2013

Figure 4.21 South American HVDC Transmission Market Forecast 2013-2023 ($m, AGR %)
1,200 30% 20% 10% 800 0% -10% -20% -30% 200 -40% -50% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Year AGR

1,000

$m

600

400

Source: Visiongain 2013

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The High Voltage Direct Current (HVDC) Transmission Market 2013-2023

6. Expert Opinion
6.1 Europacable
Marcello Del Brenna is the CEO of Prysmian PowerLink Srl with specific responsibility for HV and Submarine businesses in the Prysmian Group. He is also a Member of the Europacable Executive Board and a Chairman of its Utilities Board. He holds a degree in nuclear engineering from the Politecnico di Milano and has been working at Prysmian since 1993. His positions within the company ensure that he has developed vast R&D, commercial and international expertise in the global electrical cabling industry.

He is interviewed here in his role as the Chairman of the Utilities Board of Europacable (www.europacable.com). The interview took place in June of 2013 and visiongain would like to thank Mr. Del Brenna for his astute and invaluable remarks.

Europacable is the association that represents and advocates on behalf of approximately 85% of the European wire and cable industry at the European level. Formed in 1991, the membership companies provide cables and wiring for an extremely broad range of applications, from energy to automotive to telecommunications and beyond. It is a champion of its members collective interest, representing them and their products at the European level.

6.1.1 Europacable Objectives

Visiongain: What is the core purpose and current focus of Europacable?

Marcello Del Brenna: Europacable is the association of cable manufacturers in Europe and it represents a pretty significant percentage of companies that operate in cable manufacturing across all the cable manufacturing spectrum; so not only transmission cables, but cables for utilities and for industrial applications, for telecommunications etc. We see it as out main task to provide sound technical information on our products to all interested parties and to raise the overall visibility of the wire and cable industry. Our products are key to ensure Europes competitiveness in the 21
st

century and Europacable member companies are the global technology leader in these areas. There are not many technology sectors left in which Europe can rightly claim such a leadership role.

If we focus on power transmission, creating a single European electricity market has become one of the top EU energy policy objectives over the past years. Clearly, electricity and transmission infrastructure is crucial to achieving this objective. In addition to our concept of partial

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The High Voltage Direct Current (HVDC) Transmission Market 2013-2023

7.2 HVDC Cable Manufacturers
HVDC component suppliers discussed in the above section have the capability to supply the cable systems needed for HVDC transmission. However, there are a number of companies, from which two stand out, that have developed as a core business segment the supply of HV cabling. These two companies, which are also the two largest suppliers of copper and optical fibre cable (speciality cable) worldwide, are Nexans and Prysmian. Analysis and comparison of these two companies is an important sub-segment of the HVDC transmission market. They are analysed below by their total company sales in 2012 (highest first).

7.2.1 Prysmian Overview

Table 7.11 Prysmian Overview 2012 (Total Company Sales 2012, HQ, Ticker, IR Contact, Website)
Total company sales, 2012 $m Headquarters Ticker IR Contact $10,465m Milan, Italy PRY:MI Luca Caserta Head of Investor Relations investor.relations@prysmiangroup.com +39 02 6449 51400 www.prysmian.com

Website
Source: Visiongain 2013

The Prysmian Group is the worlds leading supplier of speciality cables, with sales of $10.45bn in 2012. Its two main business segments are energy and telecommunications cables. The Italian company attained its number one status following the acquisition of Dutch cable manufacturer Draka in 2011 and the creation of the Prysmian Group. The acquisition was important in alleviating pricing pressure within the industry, increasing overall profitability.

7.2.1.1 Analysis and Future Outlook

The company is focussed on the energy segment of the speciality cabling market. 42 of its 56 plants focus on the manufacture of cables for this market. Capacity for subsea cabling production is also being increased, with a $53.2m expansion of a Finnish manufacturing facility completed in 2012. Further expansions explicitly for HVDC subsea cabling are planned at its Arco Felice plant in Southern Italy.

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