The board of directors of Siemens Ltd has approved the sale and transfer of its healthcare undertaking for Rs 3,050 crore to Siemens Healthcare Pvt Ltd, a subsidiary of Siemens AG.

The board has also decided to consider the distribution of 50 per cent of the sale consideration as reduced by applicable capital gains tax and dividend distribution tax, as a special dividend, at the first board meeting after the completion of the proposed transaction, the company said in a statement.

Sunil Mathur, Managing Director and Chief Executive Officer, Siemens Ltd, said, “This transaction follows Siemens AG’s global strategy of managing its healthcare business under a separately-managed company. Over 85% of Siemens Ltd healthcare revenues are currently derived from products imported from Siemens AG."

"Significant management focus, including investments, will be needed in finding appropriate products and solutions to meet the growing demands of the Indian market. As there are limited synergies between the healthcare and other businesses of Siemens Ltd, this transaction will enable Siemens Ltd to increase its focus on, and capital allocation to power generation, transmission and distribution, mobility, industrial automation and smart cities segments, while enabling Siemens AG to further strengthen its focus on the healthcare segment in India, by aligning it with its global strategy and management framework,” Mathur said.

The consideration for the proposed transaction, recommended by the audit committee, is based on the valuation undertaken by two independent valuers – Deloitte Touche Tohmatsu India LLP and KPMG India. Citigroup Global Markets India is acting as the transaction advisor to Siemens Ltd.

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