Siemens Spinoff: Energy, Divided

Conglomerate separates gas, power, renewables due to low demand for gas turbines

Remember when the beloved show Cheers took one of its popular but niche-y characters and gave Frasier his own platform to operate? This is (kind of) like that! German conglomerate Siemens AG said it will spin off and give up its majority stake in its energy division and merge it with separately listed wind turbine supplier Siemens Gamesa Renewable Energy (SGRE) as part of its “Vision 2020+” strategy concept.

The board said the move would help Germany-based Siemens meet medium-term growth and profit targets… Siemens will also give up its majority stake in GP. However, it will remain a strong anchor shareholder in the new company, with a stake that is to be initially somewhat less than 50 percent and, for the foreseeable future, above the level of a blocking minority holding. Siemens will continue to support the new company, for example, through the professional services of Siemens’ Financial Services, the strong sales network of the Siemens Regions and the licensing of the powerful Siemens brand.

  • Creation of new major player on the energy market with business volume of €30 billion and over 80,000 employees through spinoff of Gas and Power and transfer of Siemens’ SGRE stake
  • Spinoff to give shareholders direct participation in success and enable rapid implementation
  • Future industrial core: Digital Industries and Smart Infrastructure
  • Ambitious medium-term goals refined and long-term aspiration outlined
  • Savings of €2.2 billion by 2023 through structural efficiency gains planned
  • Growth in future-oriented fields to generate net increase of over 10,000 jobs despite efficiency measures, the company announced in a May 7 press release.

Klaus Patzak (54), currently Managing Partner of the Siemens Portfolio Companies, has been appointed Chief Financial Officer (CFO) of the new Siemens Gas and Power business (GP), the company said the following day. In this role, Patzak will be responsible for building the Finance governance structures, steering the activities required for carving out and listing, and helping to shape the format of the future stand-alone Siemens energy business. In his new role, he will report directly to Lisa Davis, Chief Executive Officer (CEO) of the Gas and Power Business that is to be created. Via a functional reporting line, he will also report to Siemens CFO, Ralf P. Thomas.

Patzak returned to Siemens in April this year. The finance and transformation expert was most recently CFO of Bilfinger SE, having previously been CFO of Osram Licht AG. For several years, Patzak served, among other things, as head of Accounting, Reporting and Controlling at Siemens AG.

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