UPDATE 2-No quick dividend seen for Siemens' Osram listing

Fri Dec 7, 2012 12:46pm EST

* Says no dividend to be expected for 2013

* Plans dividend payout ratio of 30-50 pct in long term

* Sees 2013 loss, albeit smaller than 2012 level

* Osram book value 2.32 billion euros - Siemens

By Maria Sheahan

FRANKFURT, Dec 7 (Reuters) - Siemens says shareholders should not expect any immediate dividend from lighting unit Osram after its planned spin-off next year, due to the costs of restructuring.

The loss for the fiscal year ending September 2013 will be smaller, however, than the 378 million euros ($489 million) booked a year earlier, according to a spin-off prospectus published on Siemens' website on Friday.

And for the longer term Osram would aim to pay 30-50 percent of its annual net profit to shareholders as a dividend.

Siemens plans to give 80.5 percent of Osram, which has a book value of 2.32 billion euros, to its shareholders in a spin-off in the spring next year, while keeping 17 percent itself.

Analysts have said they expect that Osram's shares could list at around 24-25 euros apiece, which would give it a market value of 2.5 billion and 2.9 billion euros.

The move is part of a broader overhaul of the Siemens group which entails selling less profitable, non-core businesses, and saving 6 billion euros.

Osram generates annual sales of about 5 billion euros and has about 39,000 employees worldwide. Its lamps are used to light up Disneyland Paris, the Hippodrom beer tent at Munich's Oktoberfest and the Arena Corinthians in Sao Paulo, which will host the opening match of the 2014 World Cup soccer tournament.

Osram, whose brand is 106 years old, has come under pressure to invest in light-emitting diode (LED) technology, having been slow to adjust to a shift in demand to more efficient and durable sources of lighting from traditional incandescent bulbs.

LEDs are becoming increasingly popular as a source of general lighting in shops and restaurants, for outdoor displays, and for headlights in cars.

Consultancy McKinsey saw the LED market growing more than sevenfold to almost 65 billion euros by 2020, accounting for the bulk of global demand for lighting.

NEW STRATEGIC FOCUS

So far only two of Osram's 44 factories in 16 countries make LEDs - in Regensburg, Germany and Penang, Malaysia - but it is building a new plant in China at a cost of over 100 million euros to boost its presence in the fast-growing Asian market.

Meanwhile, newer players in lighting such as South Korean groups LG Electronics and Samsung Electronics have been building capacity and driving down prices, challenging market leaders Philips Electronics, Osram and General Electric.

"The shift in technology and the resulting fundamental changes in the business environment require a new strategic focus," Siemens said on Friday.

Last week, Osram announced that it would cut another 4,700 jobs, or 12 percent of its workforce, and sell factories to save 1 billion euros over three years.

The company had adjusted net debt of 1.1 billion euros at the end of September, which was down from 1.6 billion a year earlier. Siemens said it aims for Osram to have an investment grade credit rating following its listing.

The spin-off still needs the approval of shareholders at an annual meeting on Jan. 23.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

Find your dream retirement town

Florida? Hawaii? Reuters has teamed up with Zillow to give you the power to customize a list of your best places to retire.  Video | Full Article