The board of directors of Siemens Ltd has approved the proposal to demerge its energy business into a separate legal entity – Siemens Energy India Ltd.
Siemens Energy India Ltd, currently a wholly-owned subsidiary of Siemens Ltd, will be subsequently listed and will mirror the shareholding of Siemens Ltd, upon the receipt of requisite approvals, a release from Siemens said.
Scheme of arrangement
As per the scheme of arrangement, shareholders of Siemens Ltd will receive one share of Siemens Energy India Ltd for every one share of Siemens Ltd. The new entity will subsequently be listed on Indian stock exchanges – BSE Ltd and National Stock Exchange of India. The process of demerger, including receipt of requisite approvals, and subsequent listing of Siemens Energy India Limited is expected to be completed in 2025.
Two strong entities
The demerger will lead to the creation of two strong and independent entities which are able to better address their respective markets and customers with a more focused approach, the release said.
Focus areas
Siemens Ltd will continue to be a leading technology-focused company in industry, infrastructure and mobility while Siemens Energy India Ltd will focus on being the most valued energy technology company supporting its customers in transitioning to a more sustainable world.
Siemens Energy India Ltd will provide solutions across the entire energy value chain – from power and heat generation, transmission to storage through a portfolio that includes conventional and renewable energy technology such as gas and steam turbines, hybrid power plants operated with hydrogen as well as power generators and transformers.
Focus on core portfolios
Sunil Mathur, Managing Director & Chief Executive Officer, Siemens Ltd, said, “Siemens Energy India Ltd and Siemens Ltd will script new paths as two independent, publicly-listed companies. The underlying market drivers and capital allocation requirements are fundamentally different in the energy business compared to the industrial business. The demerger will enable both companies to pursue their specific strategies, focus on their core portfolios and take decisions on capital allocation. This will enable the full value of each of the businesses to be unlocked for the benefit of the shareholders.”
Performance in Q2
During the second quarter (January to March) of Siemens’ current financial year, Siemens recorded a 19 per cent year-on-year increase in revenue, at Rs.5,248 crore. During the quarter, Siemens recorded new order inflow of Rs.5,184 crore.
It may be noted that Siemens’ accounting year covers the period October 1 to September 30. The period January 1, 2024 to March 31, 2024 therefore refers to the second quarter (Q2) of its ongoing accounting year that will end on September 30, 2024.
Featured photograph (source: Siemens) is for representation only.
