Iberdrola to sell its Stake held in Siemens Gamesa Renewable Energy to Siemens

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Feb 24, 2020, 09:50 EST

Feb 24, 2020, 09:50 /Comserve / -- All of the shares held by Iberdrola S.A. in Siemens Gamesa Renewable Energy (SGRE) would be divested and sold to Siemens, which would acquire the 8.1% shareholding at Euro 20.00 per share.

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Siemens AG (FWB: SIE) had announced recently that it has decided to acquire the entire stake of 8.1% held by Spanish power utility company Iberdrola SA (BME: IBE) in SGRE. The documents were filed by both Siemens Gamesa and Iberdrola with National Securities Market Commission (CNMV).

Iberdrola is expected to obtain EUR 1.1 billion (USD 1.2 billion) from Siemens on completion of the transaction. Both the companies are expected to settle their legal disputes, if any amicably.

A co-operation agreement between Siemens, SGRE and Iberdrola has been signed, which will cover few of the projects associated with wind power generation, including working towards the improvement of distribution grid. These projects forming part of this co-operation agreement, wherein, Iberdrola will in its capacity of a customer of SGRE and Siemens grant these companies negotiation rights exclusively for a limited time period.

Moreover, Siemens anticipates that at least 100 million Euros could be attained after the unwinding of shareholder agreement, in addition to intense co-operation achieved between Siemens and SGRE. This could help the net present value to arrive at around 900 million Euros.

Siemens is widely anticipated to contribute all the shares held by it in SGRE to the new Siemens Energy company, as per its plans to head for a spin-off followed by public listing of its Gas and Power business. Post completion of the transaction, Siemens Energy that is holding close to 67% of the voting rights in SGRE would be occupying a shareholding that exceeds two-thirds majority at the annual general meeting of the company. The company has not made any plans to announce any mandatory offer for takeover from the external shareholders of SGRE.

Joe Kaeser, the President and CEO of Siemens AG had mentioned that even before anybody else, both Iberdrola and Siemens had initiated the first step by going for consolidation in the sector. He further stated that Siemens have worked on creation of a leading supplier of renewable energy. He also feels that there is a lot of potential for SGRE to grow and create significant value. He further added that SGRE has been an important cornerstone that has been part of Siemens Energy Portfolio, which will be able to shape the transition of energy from conventional to renewable energy and that the time has arrived to proceed ahead on their mission towards the next step.

Michael Sen, who is the member of Managing Board and CEO of Siemens AG had stated that 2020 was considered to be the crucial year, wherein climate protection has become the topmost priority. He further stated that Siemens Energy is anticipated to find many opportunities coming its way, owing to the fact that energy transition has been taking place. He also added that the company would be able to offer tailored solutions for those nations seeking energy as well as nations who are low carbon leaders, given the varied and continuous growth of the renewables portfolio of the company.

Independent Writer

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