The Board of Siemens Limited, the Indian arm of the German technology group Siemens AG, on May 14 approved the proposal to demerge its energy business into a separate legal entity – Siemens Energy India Limited.
The new entity will subsequently be listed on the BSE Limited and National Stock Exchange of India Limited, the company said in a regulatory filing.
As per the scheme of arrangement, shareholders of Siemens Limited will receive one share of Siemens Energy India Limited for every one share of Siemens Limited.
Siemens Limited will continue to be a leading technology-focused company in industry, infrastructure and mobility while Siemens Energy India Limited will focus on being energy technology company supporting its customers in transitioning to a more sustainable world, the company added.
The demerger will lead to the creation of two strong and independent entities which are able to better address their respective markets and customers with a more focused approach.
The process of demerger, including receipt of requisite approvals, and subsequent listing of Siemens Energy India is expected to be completed in 2025, the company added.
Sunil Mathur, Managing Director and Chief Executive Officer, Siemens Limited, said, “The demerger will enable both companies to pursue their specific strategies, focus on their core portfolios and take decisions on capital allocation. This will enable the full value of each of the businesses to be unlocked for the benefit of the shareholders.”
Meanwhile, Siemens Ltd posted a 74 percent on-year rise in consolidated net profit at Rs 896 crore in the March quarter.
Revenue rose 19 percent to Rs 5,248 crore, Siemens, which follows October to September financial year.
The company also plans to invest Rs 519 crore for expansion of its gas insulated switchgear factory in Goa and Metro train manufacturing unit in Aurangabad.
Shares of Siemens on May 14 closed 1 percent higher at Rs 6,698.60 apiece on BSE.
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