Siemens chief financial officer Ralf Thomas expressed his pleasure at the significant progress made in optimizing their portfolio through the sale of Innomotics to KPS.
Siemens, the German industrial giant, announced on Thursday its plans to sell its electrical motors business, Innomotics, to the US private equity firm KPS Capital Partners for 3.5 billion euros (USD 3.8 billion). Innomotics, a subsidiary that produces motors and other systems used in industries such as chemicals, oil, utilities, and automotive, employs around 15,000 people. The sale, approved by Siemens’ managing and supervisory boards, is expected to be finalized in the first half of the fiscal year 2025.
Siemens CFO Ralf Thomas expressed satisfaction with the sale to KPS, noting significant progress in optimizing the company’s portfolio. Established as a separate entity in 2023, Innomotics was fully owned by Siemens. Although Siemens had announced plans for a public listing of Innomotics late last year, it decided to sell the subsidiary to KPS instead. The sale was announced as Siemens reported a 38% decrease in second-quarter net profit compared to the previous year, totalling 2.2 billion euros. Revenues dropped by 1% year-on-year from January to March, and orders fell by 13% in the same period. Siemens’ fiscal year runs from October to September.
Siemens has faced challenges recently due to customers reducing excess stock levels. The company also experienced poor performance in China, with a 25% drop in orders and a 20% decline in revenues in the second quarter. The “digital industries” unit, which supplies factory automation technologies and had previously driven growth, saw a 13% decline in sales. However, the “smart infrastructure” division, which focuses on areas like data centres, had a slight increase in sales. The “mobility” unit, which produces trains, recorded a 6% rise in revenues but a 49% fall in orders.
Headquartered in Munich, Siemens has a long history of producing heavy industrial equipment. In recent years, the company has been shifting its focus towards digital technology and factory automation.
