Siemens Energy Mulls Siemens Ltd Stake Sale
POWER & RENEWABLE ENERGY

Siemens Energy Mulls Siemens Ltd Stake Sale

Siemens Energy, a major player in the wind and gas turbine industry, is reportedly contemplating a significant move to enhance its financial stability. The company is considering the sale of a substantial portion of its 24% stake in Indian-listed Siemens Ltd to its former parent, Siemens AG. This potential stake sale, which currently holds an approximate value of $3.5 billion, could serve as a swift and effective means for Siemens Energy to bolster its capital base. These considerations align with ongoing discussions with the German government and Siemens regarding the provision of guarantees for performance bonds. Both Siemens Energy and Siemens AG have refrained from making official comments on the matter.

Siemens AG, which already owns a controlling 51% stake in Siemens Ltd, is contemplating the strategic expansion of its shareholding in the subsidiary. Raising its stake in Siemens Ltd would be a move that Siemens AG could more easily justify to its shareholders compared to issuing guarantees to Siemens Energy, according to sources familiar with the situation.

It's essential to note that these deliberations represent one of the options currently under discussion, and there is no guarantee that a transaction will materialise, as stated by an insider. Bloomberg, which was the first to report on the potential stake sale, has cited individuals with knowledge of the matter who suggest that Siemens Energy may announce the divestment of its shares in Siemens Ltd as early as this week.

This development comes at a time when Siemens Energy is actively engaged in discussions with the German government, various banks, and Siemens itself to secure guarantees amounting to 15 billion euros. These guarantees are intended to safeguard major industrial projects and address financial concerns within the company.

Siemens Energy recently witnessed a record low in the value of its shares after disclosing these ongoing talks, causing uncertainty among investors. However, on Monday, the shares experienced a notable uptick, closing 12.7% higher. This positive market response reflects optimism that the discussions may lead to a favourable outcome.

Sources close to the matter had previously informed Reuters that Siemens Energy was exploring various measures to bolster its balance sheet, including potential asset sales. This follows a recent agreement to sell its Trench high-voltage component division to Triton as part of its broader financial strategy.

Siemens Energy, a major player in the wind and gas turbine industry, is reportedly contemplating a significant move to enhance its financial stability. The company is considering the sale of a substantial portion of its 24% stake in Indian-listed Siemens Ltd to its former parent, Siemens AG. This potential stake sale, which currently holds an approximate value of $3.5 billion, could serve as a swift and effective means for Siemens Energy to bolster its capital base. These considerations align with ongoing discussions with the German government and Siemens regarding the provision of guarantees for performance bonds. Both Siemens Energy and Siemens AG have refrained from making official comments on the matter. Siemens AG, which already owns a controlling 51% stake in Siemens Ltd, is contemplating the strategic expansion of its shareholding in the subsidiary. Raising its stake in Siemens Ltd would be a move that Siemens AG could more easily justify to its shareholders compared to issuing guarantees to Siemens Energy, according to sources familiar with the situation. It's essential to note that these deliberations represent one of the options currently under discussion, and there is no guarantee that a transaction will materialise, as stated by an insider. Bloomberg, which was the first to report on the potential stake sale, has cited individuals with knowledge of the matter who suggest that Siemens Energy may announce the divestment of its shares in Siemens Ltd as early as this week. This development comes at a time when Siemens Energy is actively engaged in discussions with the German government, various banks, and Siemens itself to secure guarantees amounting to 15 billion euros. These guarantees are intended to safeguard major industrial projects and address financial concerns within the company. Siemens Energy recently witnessed a record low in the value of its shares after disclosing these ongoing talks, causing uncertainty among investors. However, on Monday, the shares experienced a notable uptick, closing 12.7% higher. This positive market response reflects optimism that the discussions may lead to a favourable outcome. Sources close to the matter had previously informed Reuters that Siemens Energy was exploring various measures to bolster its balance sheet, including potential asset sales. This follows a recent agreement to sell its Trench high-voltage component division to Triton as part of its broader financial strategy.

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