Toshiba Corporation (6502.T) is close to making a deal to purchase Swiss smart meter company Landis+Gyr, according to Bloomberg.

The news agency cited two unnamed sources who said the transaction could be worth $2 billion.

Toshiba reportedly beat takeover bids submitted by private equity firms TPG Capital and EQT Partners.

Landis+Gyr has annual sales of more than $1.3 billion and an installed base of more than 300 million meters. The company has gone through several different owners in the past, including Siemens (NYSE: SI) and Kohlberg Kravis Roberts & Co. Currently it is owned by a group of investors that includes Bayard Capital of Australia.

In 2010, Landis+Gyr surpassed Itron (Nasdaq: ITRI) as the number one smart meter supplier to utilities in the U.S., and the firm recently announced that it has been selected to provide meters for the first phase of a major smart grid project in China.

Toshiba makes power-generating equipment as well as consumer electronics. As a result, smart meters and smart grid applications are a natural connection that would link utility and consumer revenues. Toshiba said last year it is expecting sales of 700 billion yen ($8.6 billion) from “smart grid” and “smart communications” businesses this year.

The acquisition of Landis+Gyr will immediately make Toshiba a major player in the smart grid market.

“For Japanese firms such as Toshiba, an acquisition is a quick way to expand in the smart grid-related businesses after focusing mainly on information technology operations,” Masahiko Ishino, an analyst at Mitsubishi UFJ Morgan Stanley Securities Co. in Tokyo, told Bloomberg.

Photo by Landis+Gyr

Reprinted with permission from Sustainable Business