Manager Magazin reports that Siemens Energy is considering the spin-off unit 'Transformation Industry'.

Manager Magazin reported Thursday that Siemens Energy may spin off its "Transformation Of Industry" division which produces compressors and'steam turbines.

A document from the group's internal strategists was revealed to the magazine. It showed that the split would result in higher margins over the long-term and more value for the shareholders.

Siemens Energy said it regularly reviews its portfolio in order to make sure that every business is given the best financial and strategic conditions to grow, compete and invest over the long term.

It stated that it was evaluating the?best setup for its Transformation Of Industry business to accelerate growth, but no decisions had yet been made.

Following the report, shares of Siemens Energy continued to grow?earlier gains and are now trading?up? 5%.

Siemens Energy claims that the division is the world's largest manufacturer of industrial steam generators and turbines. It also ranks second in the production of compressors. This was 13.5% of the EUR20 billion group sales.

It employs approximately 17,000 people.

The magazine reported that Siemens Energy was considering as a preliminary step divesting about 60% of the shares in its division. A spin-off, or initial public offering, is also possible. The remaining 40% would be retained by the company.

The magazine cited an internal document that said the most optimistic scenario would see the division's annual turnover increase by over three-quarters between 2025 and 2031, to between EUR10 billion and EUR11 bn, with profit nearly tripling between EUR1.6 billion & EUR1.8 bn. (Reporting and Editing by Matthias Williams and Kirsten Donovan, Kirsten Doovan, Matthias Steitz)

(source: Reuters)