Siemens to spin off €3 billion electric motors and drives business

ZURICH, Nov 17 (Reuters) – Siemens (SIEGn.DE) will combine its five businesses into a separate electric motors and drives company with revenue of about 3 billion euros ($3 billion).

The German engineering firm said its large drive applications and metal parts maker and Sykatec, part of its portfolio companies, will be combined.

They will be joined by Weiss Spindeltechnologie, Siemens’ high-precision motorized spindle division, and Digital Industries’ low-voltage motor and gearmotor division, and management sees them sharing suppliers, customers and technology.

“We have decided to combine these businesses in fiscal year 2023 to form a new company with its own legal structure,” Bush told reporters after Siemens reported fourth-quarter earnings.

“We believe this integrated electric motor and large drives supplier with high value creation capabilities will be stronger and more resilient than each operating independently.”

The new company will have 14,000 employees and operate in the electrification and power conversion market estimated to be worth around 20 billion euros, Siemens said.

It will compete with Switzerland’s ABB (ABBN.S) and Japan’s Yaskawa Electric. Siemens will remain active in the industrial motor business through its servo motor business, which manufactures motors for robots and integrated production lines.

Busch did not specify whether the plan was to ultimately go public, spin off or sell the new company.

“Our aim is to make the combined business fully independent of Siemens to ensure it can realize its full value and profit potential and is best positioned for future success,” he said.

($1 = EUR 0.9640)

Reporting by John Revell; Editing by Tom Hogg

Our Standards: The Thomson Reuters Trust Principles.

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