CORRECTED-UPDATE 2-Siemens picks banks for two disposals - sources
(Changes "million" to "billion" in currency conversion in sixth paragraph)
* Goldman mandated for Water Technologies sale - sources
* Rothschild mandated for security products - sources
* Co selling several units to focus on more profitable areas
* Shares down 0.3 pct
By Arno Schuetze
FRANKFURT, Jan 28 (Reuters) - Siemens AG has picked banks to organise the sale of two units as part of its efforts to streamline operations and stay competitive in a weak global economy, people familiar with the matter said.
Goldman Sachs Group Inc will advise the German conglomerate on the sale of its Water Technologies units, while Rothschild will oversee the divestment of its smaller security products arm, which makes access card readers and technology for intruder detection and surveillance, the sources said on Monday.
Siemens, Goldman and Rothschild all declined comment.
Siemens, which ranks as Germany's second-most valuable company and which makes products ranging from trains to hearing aids, late last year announced the plan to divest several units in a bid to focus on its most profitable businesses.
It also aims to put itself in a better position to compete in core product areas with the likes of Switzerland's ABB Ltd and U.S.-based General Electric Co.
Since then, several possible bidders for the water unit - which has annual sales of about 1 billion euros ($1.4 billion) and employs 600 - have approached the Munich-based group and investment bankers have started to work on the possible sale, the sources said.
HATS IN THE RING
Siemens built up its water technology operations through a flurry of acquisitions over the last decade, buying the water systems and services division of U.S. Filter from Veolia Environnement for instance for $1 billion in 2004.
Since much of Siemens's water business is focused on North America, industry sources expect U.S.-based peers Xylem Inc and Pentair Ltd to take a look at the asset.
"Asian companies are also likely to throw their hats into the ring," one of the people said.
The region is experiencing rapid economic growth, climate change effects, rising populations and stricter energy and water regulations and is therefore expected to see heavy investment in water treatment equipment in coming years, he said.
Kurita Water Industries Ltd, Hyflux Ltd, Hitachi Ltd and Marubeni Corp are seen as possible suitors, he added.
Big private equity groups like KKR & Co LP, Bain and Permira are also expected to show interest.
Permira in 2011 bought Israel-based Netafim, a maker of irrigation technology, for 800 million euros.
Siemens Water Technologies offers products ranging from conventional water treatment to emergency water supply and water disinfection systems.
A report published in 2010 by Global Water Intelligence, an industry journal, put the size of the global water market at more than $500 billion.
Siemens shares were down 0.3 percent by 1325 GMT, backtracking from a five-month high set last week, compared with a 0.1 percent drop in the main German index. ($1 = 0.7421 euros) ($1 = 0.7301 euros) (Additional reporting by Jens Hack; Editing by Hans-Juergen Peters)