NRDXF Nordex SE (PK)

FRANKFURT—A billion-euro tie up of Siemens AG's wind power activities with Gamesa Corporacion Tecnologica SA has hit a snag because the Spanish wind turbine maker needs more time to renegotiate the future of an offshore wind joint venture with French nuclear engineering firm Areva SA, people familiar with the matter said Friday.

Siemens and Gamesa reached an agreement in principle weeks ago by which Siemens would transfer its wind activities to the Spanish company in exchange for a 60% stake in a future combined entity, the people said.

The deal would create the world's largest wind turbine maker by capacity, with a market value of roughly €10 billion ($10.9 billion).

However, that transaction hasn't been signed yet because the ownership structure of Gamesa's 50-50 offshore joint venture with Areva, known as Adwen, must be rearranged in light of a management reshuffle at the Spanish company, according to the people.

One potential route under discussion could see Gamesa buy Areva's stake in Adwen, one of the people said.

Areva is closely watching developments in the offshore wind sector but remains "focused on the execution of our projects through our JV Adwen," a spokesperson for the company said in a written statement on Friday. Those projects include a 600 megawatt offshore wind farm in the German North Sea.

Gamesa and Siemens declined to comment on Friday.

The potential deal between Siemens and Gamesa would propel the German industrial conglomerate ahead of wind turbine market leader Vestas AS, while allowing it to grow its onshore wind business capabilities.

The deal would be the latest in the global wind turbine industry's process of consolidation. In October, German turbine maker Nordex SE said it would purchase the wind operations of Spain's Acciona SA for cash and shares valued at €785 million.

The industry has been preparing for "slower growth and more intense competition," according to analysts at J.P. Morgan, as it tries to reduce the cost of turbines and the cost of energy for wind.

Siemens led wind turbine orders during the second half of 2015, followed by Vestas, General Electric Co. and Gamesa, according to Navigant Research.

Monica Houston-Waesch and Carlos Lopez Perea contributed to this article

Write to Eyk Henning at eyk.henning@wsj.com and Christopher Alessi at christopher.alessi@wsj.com

(END) Dow Jones Newswires

March 04, 2016 11:55 ET (16:55 GMT)

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