According to insiders, in order to support Siemens Energy, Siemens AG only wants to acquire shares in the joint Indian subsidiary at a discount to the stock market price.
In principle, it was agreed that the technology group should take over additional shares in the Indian Siemens Ltd from Siemens Energy, several people familiar with the negotiations told the Reuters news agency. The associated unbundling of the Indian business would have been necessary in the foreseeable future anyway. Siemens is aiming for a price that is around 15 percent below the stock market price of Siemens Ltd in recent months, said two of the insiders.
Siemens and Siemens Energy did not want to comment on the status of the negotiations.
Siemens Ltd was not split up when it was spun off from Siemens Energy in 2020 because it would have been expensive and tax-unfavorable due to the stock market listing. Instead, Siemens Energy took a 24 percent stake, while Siemens AG retained 51 percent. Siemens Ltd covers the business of both companies on the Indian subcontinent, but the lion’s share goes to the divisions remaining at Siemens AG. In India, Siemens Energy also benefits from profits from sales of trains or public infrastructure, for example. Since the split, the share price of Siemens Ltd. more than doubled.
A large part of the share package could now go to Siemens. The Siemens Energy package is worth around 288 billion Indian rupees (equivalent to 3.2 billion euros). This corresponds to almost 40 times the operating profit (Ebitda) – for comparison: at Siemens the ratio is less than ten. According to the shareholders’ agreement, a sale of the shares is only possible with mutual consent.
Siemens Energy had asked the federal government for guarantees for future projects because the banks no longer wanted to handle these alone due to the energy technology group’s deteriorated credit rating and the order book of more than 100 billion euros. We are talking about 15 billion euros. However, politicians insist on the participation of major shareholder Siemens, which still holds 25.1 percent of the shares in Siemens Energy. He is cautious because he is afraid of becoming involved again with his split-off daughter. With the sale of the India shares, Siemens Energy could improve its capital base and would have more credit from the banks, according to the calculation.
Siemens loses damages lawsuit over “HS2” train project
Siemens is not entitled to compensation after its defeat in the struggle for a high-speed train project in Great Britain.
The London High Court dismissed a lawsuit brought by Siemens’ train division against the operating company HS2, which awarded the two billion pound contract to build 54 trains for the high-speed line from London to Birmingham to Siemens’ competitors Bombardier (now Alstom) and Hitachi had forgiven. Part of the order is also a twelve-year maintenance contract. Judge Finola O’Farrell ruled in the written procedure on Monday that Siemens was unable to prove that the contract was awarded illegally.
Siemens had expressed doubts that Bombardier and Hitachi could meet the technical requirements for the project. They did not adhere to the tender conditions and were only able to submit the cheapest offer because of this. A spokesman for Siemens Mobility expressed disappointment with the decision. An HS2 spokesman stressed that there had been no successful challenge to the awarding of contracts worth more than £20 billion for the project. Alstom initially declined to comment, and Hitachi could not be reached for comment.
The 54 trains will travel at speeds of up to 225 miles (360 kilometers) per hour from London to Birmingham, the country’s second-largest city. Hitachi and Alstom want to build them in three plants in Great Britain. The high-speed route was actually supposed to be completed by 2026 and continue to the north of England to Leeds and Manchester. Prime Minister Rishi Sunak canceled the second part of the route beyond Birmingham in October.
The Siemens share temporarily rose by 0.85 percent to 128.88 euros via XETRA.
Berlin/Munich/London (Reuters)
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