* Sells most of water technology activities to AEA Investors
* Deal is subject to regulatory approval
FRANKFURT Nov 6 Germany's Siemens
agreed to sell the bulk of its water technology business to
private equity group AEA Investors for 640 million euros ($862.4
The deal, flagged by Reuters last month, is subject to
regulatory approval, Siemens said on Wednesday.
The announcement comes a day before new Chief Executive Joe
Kaeser presents the company's annual results. Investors have
said they hope he will provide some clues as to his future
strategy for the company.
Under his predecessor Peter Loescher, the industrial
conglomerate whose products range from gas turbines to fast
trains and industrial automation software started shedding
assets to cut costs and close a gap with more profitable rivals
such as Switzerland's ABB and U.S.-based General
Siemens, Germany's second-biggest company by market value,
said a year ago it would divest the water technology business
because most of it operates in a highly fragmented market,
serving municipal and industrial clients, and so has little in
common with its global sales set-up.
The unit offers products ranging from conventional water
treatment to emergency water supply and water disinfection
It generated $1.3 billion in revenue in 2012 and, according
to estimates from bidders, its earnings before interest, tax,
depreciation and amortisation (EBITDA) were between $70 million
and $80 million.
Siemens plans to keep some parts of the business.
"There are major synergies for these solutions as well as
promising growth potential within Siemens' Environmental
Portfolio," the company said in a statement.
Siemens built up its water business by bolting together
several acquisitions over the last decade, including the water
systems and services division of U.S. Filter which it bought
from Veolia Environnement for $1 billion in 2004.
This year it spun off its lighting business Osram,
sold its stake in mobile telecoms equipment maker Nokia Siemens
Networks and has been in talks to sell its postal automation and
baggage handling businesses.
Two people familiar with that transaction told Reuters last
month that Siemens was in advanced talks to sell the postal
automation and baggage handling businesses to private equity
investor Triton, after investor Sun Capital dropped out.