The Siemens Gamesa Renewable Energy company will be fully integrated by Siemens Energy AG

Siemens Gamesa Renewable Energy S.A. (SGRE, Zamudio, Spain) announced a voluntary cash tender offer on May 21 to purchase all outstanding shares (about 32.9 percent of the share capital) in SGRE (Siemens Gamesa Renewable Energy S.A.), Zamudio, Spain) that it does not already hold. Minority shareholders in SGRE will receive €18.05 in cash per share. Furthermore, Siemens Energy aims to pursue the delisting of SGRE from the Bolsa de Madrid (Spanish stock exchanges), where it presently trades as part of the IBEX 35 index, if the transaction is completed successfully. The deal is expected to be completed in the second half of the year 2022.

With the wind as a major driver of the worldwide energy transformation, Siemens Energy’s long-term plan includes SGRE’s product and service offerings. However, SGRE’s recent financial performance concerns, caused by operational issues and industry-related headwinds, have heightened the need for action. The integration will aid management in resolving SGRE’s existing issues by assisting in the implementation of the essential actions to stabilize the company and maximize its potential. Siemens Energy’s closer involvement in day-to-day operations and turnaround expertise, particularly in manufacturing, supply chain, project, and customer management, will benefit SGRE in particular.

“The full integration of SGRE is a significant milestone for Siemens Energy’s standing as a leader in the energy shift from fossil to sustainable energy solutions,” says Joe Kaeser, chairman of Siemens Energy AG’s Supervisory Board. “Customers, employees, shareholders, and, in the end, society will profit from this.  The deteriorating situation at SGRE must be stopped as soon as feasible, and the value-creating repositioning must begin as soon as practicable.”

Siemens Energy expects cost savings of up to €300 million per year within three years of complete integration, and revenue synergies of a million amount that is mid-triple-digit in Euros by the end of the decade. Furthermore, a properly integrated Group would enable Siemens Energy to develop and capitalize on its 3 strategic pillars — low- or zero-emission power production, electricity transmission and storage, and reducing CO2-footprint and energy usage in industrial processes — as well as providing a one-stop-shop strategy for stakeholders based on a better offering and unified client coverage. The delisting of SGRE will also serve as a first step toward streamlining operations and achieving a much more streamlined corporate structure with leaner governance.

“The integration of SGRE is a critical step in our strategic plan to lead the energy transition.  We will become even better positioned to help our clients on their journey to a more sustainable future as an integrated organization with a much more holistic offering,” says Christian Bruch, who is the Chief Executive Officer of Siemens Energy. “This deal takes place at a time when the global energy landscape is changing dramatically. The current geopolitical developments, in our opinion, will not derail the energy transition. In this journey, increasing renewable energy will be critical. SGRE’s collaboration will benefit both firms and all stakeholders.”

 

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