Siemens Has Changed The Tone, But Can It Deliver?
Stephen Simpson, CFA
Stephen Simpson, CFA
Dec. 9, 2014, 4:43 AM
- Despite a decline in oil prices, Siemens (OTCPK:SIEGY) Chief Executive Joe Kaeser announces he would "not even think about walking away" from September's $7.6B Dresser-Rand (NYSE:DRC) deal.
- Siemens also see higher synergies from the Dresser-Rand purchase, and is now targeting 30% more savings from the acquisition. The group previously said it expected more than €150M in annual synergies by 2019.
- Previously: Siemens agrees to buy Dresser-Rand for $7.6B (Sep. 22 2014)
Nov. 16, 2014, 5:12 AM
- Dismissing speculation about a disposal, Siemens' (OTCPK:SIEGY) CEO has announced that the firm's healthcare unit will remain within the company for the foreseeable future.
- "The healthcare unit will be operated as an independent company within the company as we aim to strengthen the health business at Siemens and to prepare it for the future," says Joe Kaeser.
- Siemens previously said the legal separation of its healthcare unit was part of a move to give it more independence, resulting in speculation of a future full or partial disposal.
- Previously: Siemens should keep majority if healthcare unit goes public
- Previously: Siemens to decide on separation of healthcare unit
Nov. 13, 2014, 7:16 AM
- Rolls-Royce (OTCPK:RYCEY) expects to complete the sale of its energy gas turbine business to Siemens (OTCPK:SIEGY) by the end of the year, paving the way for a £1B ($1.58B) share repurchase.
- The company also affirmed its full-year earnings guidance which it had lowered last month when it announced a major cost cutting drive to boost profitability.
- Previously: Siemens unveils overhaul, confirms $1.3B deal for Rolls-Royce energy business
Nov. 9, 2014, 9:39 AM
- Siemens (OTCPK:SIEGY) has agreed to keep its healthcare unit as a "part of its long-term, strategic core portfolio" and must strive for majority ownership even if the unit is listed on the stock market, says Germany's trade union IG Metall.
- Siemens has agreed to several conditions for the possible spin-off, including keeping its corporate headquarters in Germany, ruling out healthcare redundancies and maintaining or expanding its job base in healthcare in Germany.
- Previously: Siemens to decide on separation of healthcare unit
Nov. 6, 2014, 4:27 AM
- Siemens (OTCPK:SIEGY) is selling its hearing-aid unit to P-E firm EQT Partners and Santo Holding in a deal valued at €2.15B ($2.68B). EQT’s goal is to position the business for an eventual IPO.
- The announcement comes as Siemens reported €1.45B in net profit for the fourth quarter, a 44% increase. Despite the profit boost, the company expects revenue to remain flat next year.
- The divestiture of Siemens Audiology Solutions follows the recent sales of two other parts of Siemens' health care business, hospital information-technology and microbiology.
- Previously: Siemens to shed hearing-aid business
Nov. 4, 2014, 6:57 AM
- Siemens (OTCPK:SIEGY) will take a first major step on Wednesday to separate its €14B ($18B) healthcare unit from the company, Reuters reports.
- Siemens' supervisory board will decide on the creation of new healthcare country units, including in Germany, capable of holding licenses for products such as imaging equipment independently of Siemens.
Oct. 22, 2014, 2:54 AM
- Siemens (OTCPK:SIEGY) is in advanced talks to sell its hearing-aid business, which could be valued at up to €2B ($2.55B), WSJ reports.
- P-E firm Permira Holdings is bidding for the hearing-aid unit by itself, while rival EQT Partners, may form a consortium with hearing aid maker GN Store Nord (OTCPK:GNNDY) to acquire the assets.
- Siemens tried to sell the unit in 2010 but was unable to find a buyer due to its declining operating profit at the time.
Oct. 15, 2014, 2:22 PM
- Siemens (OTCPK:SIEGY -2.1%) says it is cutting more jobs in Germany, mainly in its energy division, but declines to confirm a report by German public radio that said ~1,200 jobs will be shed at several German energy locations.
- Siemens’ new energy chief Lisa Davis said earlier this month that she expects narrower profit margins in the power generation business to put pressure on the unit’s results over the next 2-3 years.
Oct. 4, 2014, 5:24 PM
- Expect declining margins over the next 2-3 years, Lisa Davis, new head of Siemens' (OTCPK:SIEGY, OTCQB:SMAWF) energy division tells Borsen-Zeitung in an interview today.
- Excess capacity in the large gas turbine market has led to pricing pressure.
- Davis couldn't say whether factories would be closed, but said the extraordinarily high margins of the past aren't coming back.
Sep. 22, 2014, 7:25 PM
- Siemens (OTCPK:SIEGY) lost out to GE for Alstom's gas turbine business earlier this year but has now acquired Dresser-Rand (NYSE:DRC), a major supplier of equipment such as compressors and gas turbines used to exploit shale resources.
- But Siemens is paying up for the privilege, writes Heard On The Street's Thao Hua, at more than 14x the consensus estimate for Dresser's 2015 EBITDA - higher than previous deals in the sector and far higher than Siemens' own multiple of ~9x.
- The rate of growth in the gas turbine sector is falling, estimated to hit a trough in 2015 by Siemens' own metrics; the company expects the market will heat up again at an assumed annual growth rate of 6%-8%, but that remains to be seen.
- In terms of synergies, Siemens' scale and wide reach present opportunities to raise DRC's margins and revenue growth, but expectations of €150M ($192M) of annual synergies isn't expected to be reached until 2019.
Sep. 22, 2014, 1:57 AM
- After much speculation, Siemens (OTCPK:SIEGY) has announced that it would buy Dresser-Rand (NYSE:DRC) for $7.6B, and says that its $83/share bid was unanimously supported by Dresser-Rand's board of directors.
- Siemens also announced the sale of its 50% stake of household goods joint venture BSH to partner Robert Bosch for €3B ($3.9B).
- Siemens expects to close the Dresser-Rand deal by summer 2015, while it aims to complete the sale of its BSH stake in the first half of 2015.
- Previously: Siemens close to acquiring Dresser-Rand for $6B
Sep. 21, 2014, 2:48 PM
- Siemens (OTCPK:SIEGY) is reportedly on the verge of a $6B all-cash deal to acquire U.S. oilfield equipment maker Dresser-Rand Group (NYSE:DRC).
- Siemens is expected to pay low- to mid-$80s per share. DRC closed Friday at $79.91, and is +18% since Wednesday over takeover speculation.
- Sources say the all-cash bid has trumped a competing offer from Sulzer AG (OTC:SULZF), which was looking to merge with Dresser-Rand in an all-stock deal.
- Discussions are continuing and could still fall apart.
Sep. 19, 2014, 5:21 PM
- The latest speculation over Dresser-Rand (NYSE:DRC) now includes GE, which Financial Times reports is holding talks with DRC management about a possible takeover and is deciding whether to launch a bid.
- If it does, it could be the second time GE has faced off against Siemens (OTCPK:SIEGY) over a multibillion-dollar deal in the past six months after competing over the takeover of the energy businesses of Alstom in June.
- Siemens reportedly is in talks with DRC about a ~$80/share offer, and Swiss industrial pump maker Sulzer (OTC:SULZF) has said it is in talks with the U.S. oilfield equipment manufacturer about a possible merger.
Sep. 19, 2014, 12:26 PM
- Renova, a holding company of Russian oligarch Victor Vekselberg, says it has bought a 4.99% stake in Dresser-Rand (DRC +10.2%), adding a twist to recent speculation on DRC's future.
- Renova also holds a 33.19% stake in Swiss pump maker Sulzer (OTC:SULZF), which said earlier this week it was in talks with the U.S. company about a potential deal.
- A new report says Siemens (OTCPK:SIEGY) is preparing a $6B-plus offer for DRC.
- Meanwhile, DRC is downgraded to Sell at Gabelli, which says shares have run up too far on the M&A talk; also, a potential antitrust review, while likely not an obstacle, could mean a deal close would be 6-9 months out.
Sep. 19, 2014, 6:50 AM
- Siemens (OTCPK:SIEGY) is planning to offer more than $6.1B, or $80/share, for Dresser-Rand (NYSE:DRC), Reuters reports quoting Germany's Manager Magazin.
- Siemens' move could trigger a bidding war with Sulzer (OTC:SULZF), which announced on Wednesday that it is in advanced talks for a merger with the compressor and turbine maker.
- DRC +4.1% premarket
Sep. 18, 2014, 9:12 AM
- Dresser-Rand (NYSE:DRC) +1.5% premarket after William Blair says the company could be valued at $80-$100/share in an M&A deal with limited downside.
- Blair cites an increasing likelihood of a merger transaction after Sulzer confirmed yesterday that it is in talks to acquire DRC; the firm keeps its Outperform rating on the stock while raising its price target to $82 from $70.
- Meanwhile, Gabelli continues to believe DRC has an asking price somewhere above $80 to be acquired by Siemens (OTCPK:SIEGY).
Siemens AG is engaged in electronics and electrical engineering. The Company operates in sectors such as Industry, Energy and Healthcare.
Industry: Telecom Services - Foreign
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