OR WAIT null SECS
Siemens is adhering to its plan to spin off and publicly list Siemens Energy before the end of fiscal 2020. The company expects to record a spin-off gain, the amount of which cannot yet be reliably forecast, it said. Siemens also assumes that there will be material impacts on net income from spin-off costs and tax expenses related to the carve-out and creation of the subgroup Siemens Energy.
In the second quarter, Siemens continued to drive the public listing of Siemens Energy. Formation of the subgroup was successfully completed on April 1, 2020. The spin-off will be presented to shareholders for a vote at the Extraordinary Shareholders’ Meeting on July 9, 2020. Siemens Energy has an order backlog of €81 billion, the company has reported.
In March, business media reported that Siemens plans to retain only a minority stake in Siemens Energy while handing over some 70% of share to others. A company spokesperson, however, said no decision had been made on the shareholding of Siemens Energy. The company has been working with Goldman Sachs, Deutsche Bank, JP Morgan and BNP Paribas on the spin-off project which was expected to be based on a $11 billion valuation.
Prospective buyers being discussed in the market included its rival, Mitsubishi Hitachi Power Systems. The two companies had shared the Westinghouse F-class technology which played a key role in the development of subsequent gas turbine products in both the two companies.
While the market has been talking about the Siemens power business being sold to other companies in early 2019, tn October last, Siemens AG announced formal plans for a Siemens Energy company that would include its Gas & Power Business as well as its renewable energy division. It was then expected that the new entity would be formed in April 2020 and then spun off to become an independent entity that would be listed publicly later that year.
Siemens Gas & Power includes the core gas and steam turbine business. Siemens Energy would also include the Siemens Games Renewable Energy.
This year, Siemens decided to buy out Iberdrola’s stake in wind-turbine unit Siemens Gamesa Renewable Energy for about 1.1 billion Euros ($1.21) even as the relationship between the two companies would continue. Siemens would hold a 67% stake in the future which will all be turned over to the Siemens Energy company.
Renewable energy continues to be hot and turbomachinery companies that made investments in that sector are now betting big on it. In the US,for instance, the Energy Information Administration has forecast that together wind and solar new capacity would exceed gas-fired capacity. Some 19GW of wind is forecast to come online in 2020.