Swiss power and automation technology firm ABB has agreed to acquire Italian company RGM's rail vehicle power business for an undisclosed sum.
The acquisition is expected to be completed by the third quarter of 2012.
Headquartered in Genoa, Italy, RGM provides auxiliary converters that offer on-board energy supplies on underground rail, light rail vehicles and mainline trains and locomotives.
RGM also offers smaller power supplies, components and other power-electronic equipment to various industries, though this part of the business is not included in the acquisition.
RGM's expertise in power electronics and rolling stock is expected to benefit ABB in providing its customers with advanced auxiliary converter systems, in particular for markets with direct current (DC) line voltage.
ABB's head of discrete automation and motion division Ulrich Spiesshofer said that the company, with the new solution, will be able to offer a wider combined portfolio of auxiliary converters and traction converters to support its traction technology growth.
"The RGM Polycontrol team will bring to ABB important engineering and manufacturing expertise, as well as a strong track record in the Italian market," Spiesshofer said. "The acquisition is in line with our divisional strategy to expand our technology platform and solutions offering in the attractive global and regional rail market."
ABB has previously revealed that its rail business has been growing at 30% a year for the last few years, and in 2011 the company secured more than $1.1bn worth of orders from the rail industry.