Engineering major Siemens Ltd is selling its healthcare business to group company Siemens Healthcare Private for Rs 3,050 crore, in a bid to focus more on businesses such as power generation and transmission and industrial automation. The move is part of Siemens’ global strategy to manage its healthcare business under a separately-managed company.
“The board of directors of Siemens has approved the sale and transfer of its healthcare undertaking, as a going concern on a slump sale basis, for Rs 3,050 crore,” the company said on Friday.
The valuation of the proposed transaction has been arrived at by two independent valuers —Deloitte Touche Tohmatsu India and KPMG India.
The Germany-based trains-to-turbines and medical equipment maker had announced an internal reorganisation in 2014, dividing the company into nine divisions and spinning off its healthcare business into an independently operated unit.
Over 85% of Siemens’ healthcare revenues are derived from products imported from Siemens AG, and significant management focus and investment will be needed in finding appropriate products and solutions to meet the growing demands of the Indian market, said Sunil Mathur, MD and CEO of Siemens Ltd.
“As there are limited synergies between the healthcare and other businesses of Siemens Ltd, the transaction will enable Siemens to increase its focus on, and capital allocation to power generation, transmission and distribution, mobility, industrial automation and smart cities segments,” he added.