Siemens to spin out IT solutions division

By Nicola Brittain on Dec 8, 2009 9:19 AM
Filed under Technology

Restructure as German giant sees 4Q net loss of $1.65bn

German manufacturing company Siemens has said it will split off its IT Solutions and Services business by 1 July 2010 to form a separate unit.

The move will see a restructure and possible flotation of the struggling division.

In an interview with the Wall Street Journal, CFO Joe Kaeser said: “All options for the unit remain open, including an IPO or a joint venture.”

Analysts also expect restructuring of the business, where a profit margin of 6.3 percent in 2009 was far below expectations of 11 to 15 percent.

The announcement was made with the release of the group's fourth quarter results, which saw a write-down on Siemens 50 per cent stake in Nokia Siemens Networks (NSN) that contributed significantly to its reported €1.98bn loss on equity investments. The company posted a fourth quarter net loss of $1.65bn.


Siemens said this was the result of significant market deterioration resulting from reduced operator spending and tough competition from Chinese vendors. NSN was created in 2007 with Finland's Nokia.

Siemens also posted a 25 percent rise in operating profit, which was higher than expected. Siemens launched a plan in July last year to cut €1.2bn (AU$1.94bn) in operating costs by the end of 2010. It said on Thursday it had cut €2bn (AU$3.24 bn)as of September 2009.

That programme entailed 17,000 job cuts worldwide.

 
Follow us on Facebook and Twitter
 

channelweb.co.uk @ 2010 Incisive Media

Siemens to spin out IT solutions division
 
 
 
 
 
Top Stories
Reseller pays $2.65m for telco specialist
Acquisition scene heats up as JCurve makes another buyout.
 
Kytec files for administration, new company set up
Driven by management buyout, says MD.
 
Dataflex reborn under new owners
Buyer aiming for $30m after second acquisition in six months.
 
Sign up to receive CRN email bulletins
   FOLLOW US...
Latest Comments
Polls
Are Chromebooks ready for the enterprise?

CRN Magazine

Issue: 326 | April 2014

CRN Magazine looks in-depth at the emerging issues and developments for the channel, and provides insight, analysis and strategic information to help resellers better run their businesses.