Siemens AG intends to buy 18 per cent share from Siemens Energy in their Indian joint venture, Siemens Ltd for $2.28 billion, reflecting a 15 per cent discount on their average price. 

"The purchase price reflects a customary discount of 15 per cent on the 5-trading-days volume-weighted average price before the day of signing," said Siemens AG in a statement, according to a report in news agency Reuters.

Siemens Ltd shares were last seen trading 2.39 per cent higher at Rs 3,499.95 today. At this price, the company's turnover came at Rs 12.24 crore with a market capitalisation (m-cap) of Rs 1,24,640.31 crore.

This development comes after the news agency reported earlier this month that Siemens AG is seeking a discount from Siemens Energy for any possible purchases of shares in their Indian joint venture Siemens Ltd. It was then reported that Siemens AG hoped for a discount of around 15 per cent. The asset’s valuation has more than doubled since 2020. 

Siemens Energy was weighing the sale of a substantial part of its 24 per cent stake in Siemens Ltd, where Siemens AG already owns 51 per cent, to boost liquidity. After the deal, Siemens Energy’s stake will decrease to 6 per cent.

Siemens Energy was spun off Siemens AG, but the Indian division, Siemens Ltd remained integrated. Under an ownership agreement between the two groups, Siemens Energy cannot sell any shares in Siemens Ltd without the consent of Siemens AG.

Discussions around a stake sale in Siemens Ltd come as Siemens Energy is seeking billions of euros in project related guarantees from the German government, banks and Siemens AG, which retains a direct 25.1 per cent stake following the spin-off.

(With Reuters inputs)

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2023-11-15T10:01:49Z dg43tfdfdgfd