FRANKFURT (Reuters) - Siemens said it expected around 70 percent of synergies from its wind power deal with Gamesa to come from cost savings, while the rest will be derived from revenue synergies.
Siemens and Spain’s Gamesa agreed earlier on Friday to create the world’s biggest builder of windfarms, with the German industrial group paying 1 billion euros ($1.1 billion) for a majority stake in the combined business.
Asked whether the cost synergies would result from job cuts, Siemens Chief Executive Joe Kaeser said on a conference call on Friday: “This is not so much about jobs, but it is that there are two companies that were very active in onshore... we only need R&D (research and development) for the next generation of onshore once, not twice.”
Siemens and Gamesa expect cost savings and benefits from the new business to be worth 230 million euros of earnings before interest and taxes (EBIT) within four years, more than half of which should come into effect after two years already.
Reporting by Maria Sheahan; Editing by Tina Bellon