Siemens AG announced on Tuesday, May 7, it would combine its struggling power and gas unit and renewable energy businesses and spin off the new company to shareholders as part of a broader effort to streamline the venerable conglomerate and boost profits.
Specifically, the company noted that it will add its 59% stake in Siemens Gamesa Renewable Energy to the Gas and Power division spinoff which will be managed separately. It is expected that the stock exchange listing will be conducted in September 2020.
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Siemens also plans to give its majority stake in Gas and Power. Thus, the company’s stake will be at about 50%, above the level of a blocking minority holding.
The decision is to be discussed through a meeting in June 2020. After that, Siemens will deconsolidate both the new Gas and Power division and Siemens Gamesa.
To that matter, Lisa Davis, CEO of Siemens’ Gas and Power commented
Being independent will enable us to more effectively leverage our position of strength to further support our customers in rapidly changing energy markets.
In the meantime, Joe Kaeser, President and CEO of Siemens AG noted that this step represents a powerful play in the energy and electricity sector.
He concluded that combining the company’s portfolio for conventional power generation with power supply from renewable energies will enable them to fully meet customer demand.
