The wind power company Gamesa is listed on the Spanish stock exchange and is more than two thirds owned by Siemens Energy. But things are not going as planned for the daughter. Siemens Energy is now making a purchase offer to the other shareholders.
Siemens Energy wants to completely take over its Spanish wind power subsidiary Siemens Gamesa. Siemens Energy offers 18.05 euros per share in cash, as the energy technology company announced after a supervisory board meeting. Overall, Siemens Energy would have to shell out a good four billion euros for the remaining Gamesa shares. The aim is to take Siemens Gamesa off the Madrid Stock Exchange.
Siemens Energy boss Christian Bruch hopes to be able to take the problem child closer to the curb and speed up its renovation. Siemens Energy already holds 67.1 percent of the shares in the Spanish subsidiary, but has so far only been able to control it through the supervisory board due to its independent stock market listing.
Bruch wants to present his strategy for the next few years at a capital market day on Tuesday, May 24th. Siemens Gamesa is actually the beacon of hope for the manufacturer of gas and steam turbines, but has been making negative headlines for years with losses, missed profit forecasts and operational problems. There are major teething problems with the new 5.X generation of wind turbines, and Siemens Gamesa is running out of raw material costs, while fixed prices have been agreed with customers in the supply contracts.
"The transaction will support management in overcoming the current challenges at Siemens Gamesa," the statement said. The integrated company can benefit from significant cost and revenue synergies. Bruch had recently described the figures from Siemens Gamesa as disappointing, but acknowledged wind power as an essential part of the strategy. The situation at Gamesa has worsened since the recent profit warning.
The takeover bid for Siemens Gamesa is eight percent higher than Friday's closing price of EUR 16.75. However, the share had already risen sharply in the past few days after the takeover plans had become more concrete, according to insiders. Before the first speculation at the beginning of the week, the paper was 14.13 euros. In order to take Siemens Gamesa off the stock exchange, the Munich-based company needs 75 percent of the shares under Spanish law.
Siemens Energy wants to finance the increase mainly with equity. The company wants to raise up to 2.5 billion euros with shares and hybrid bonds in order not to lose the investment grade rating. A first step could be a capital increase without subscription rights, which is limited to ten percent of the share capital and is usually placed with investors overnight. The investment banks Bank of America and JPMorgan will provide the bridge financing until then.