Siemens in talks to sell solar business
German engineering group Siemens is to sell its solar energy business and is already holding talks with potential buyers, as it trims underperforming businesses to close a profitability gap with peers.
Demand for solar power has been hurt by top consumer Europe cutting back subsidies for green energy and the euro zone debt crisis crippling the finances of sunny countries such as Greece and Spain.
"Due to the changed framework conditions, lower growth and strong price pressure in the solar markets, the company's expectations for its solar energy activities have not been met," Siemens said on Monday.
A sale of the solar thermal and photovoltaics units, which have a total 680 employees, will leave Siemens with wind and hydro power in the renewable energy sector.
Siemens said this month it would review underperforming businesses as part of its new savings plan, to catch up with the profits of peers such as Swiss group ABB or US-based General Electric.
The units up for sale - which make solar thermal and photovoltaic plants big enough to power thousands of homes - posted losses last year that exceeded their revenues of less than 300 million euros ($391 million).
Siemens did not say who could buy the units and has so far also not yet elaborated how much money it aims to save or how many jobs could go as part of its new programme, dubbed Turbine 2013. It has promised further details for Nov. 8.
Analysts have said the company could seek to divest or restructure further businesses, such as its underperforming Infrastructure & Cities division, which bundled businesses making products such as security systems and high-speed trains.
SOLAR WOES The sale of the solar businesses puts an end to decades of investment by Siemens in the sector. It participated in a pilot photovoltaic project on the Greek island of Kythnos in the early 1980s and built up one of the world's biggest makers of solar panels in the 1990s, which it later sold to Shell.
A number of solar companies have collapsed due to the pressures on the sector. Last week, global No.1 solar inverter maker SMA Solar announced the downturn in Europe had reached its business, saying it would cut jobs and could post a loss next year.
- Бренд Siemens
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