Germany’s Siemens seeks to up stake in Indian arm
31 Jan 2011
German engineering group Siemens AG said today it has offered to buy an additional 19.82-per cent stake in its India unit Siemens Ltd for Rs930 a share, to take its 75 per cent in the booming Indian subsidiary. The deal will cost Siemens about €1 billion.
Pending regulatory approval, the offer is scheduled to open on 25 March and is likely to close on 13 April, the company said in a newspaper advertisement this morning.
Under Securities and Exchange Board of India regulations, any move to buy more than a 15-per cent stake in a company has to be followed by an open offer to minority shareholders for a minimum stake of 20 per cent. The regulations also stipulate that if the publicly held shares in a company fall below 10 per cent, the company must delist from Indian stock exchanges.
The German group explained that it had decided to increase the holding "with the aim of further developing its business in India." Siemens Ltd employs 7,500 people in India and posted annual sales of €1.5 billion, a small but rapidly growing fraction of the group's total of €76 billion.
The conglomerate is enjoying strong growth in business in emerging markets, with new orders from India alone up 160 per cent in the latest quarter, boosted by infrastructure and power technology demand.
The move follows that of Swiss rival ABB Ltd, which last year raised its holding in its Indian subsidiary to 75 per cent, paying $1 billion for the stake.
.webp)
