Siemens CEO Kleinfeld Says Preparation for Automotive IPO 'On Schedule'

Siemens CEO Kleinfeld Says Preparation for Automotive IPO ‘On Schedule’

Siemens AG Chief Executive Klaus Kleinfeld said the company's preparations for an initial public offering (IPO) of its VDO Automotive unit were progressing "on schedule." "This is a very attractive business, not only for us, but also for others," Kleinfeld said at a press conference in Munich. Siemens in January said it wanted to list a minority stake in the business, but it did not state an exact date for the IPO, which is expected to take place this calendar year.

From AFX News Limited

MUNICH — Siemens AG Chief Executive Klaus Kleinfeld said the company’s preparations for an initial public offering (IPO) of its VDO Automotive unit were progressing "on schedule."

"This is a very attractive business, not only for us, but also for others," Kleinfeld said at a press conference in Munich.

Siemens in January said it wanted to list a minority stake in the business, but it did not state an exact date for the IPO, which is expected to take place this calendar year.

However, it has also attracted considerable interest from private equity groups as well as rivals such as Continental AG.

However chief financial officer Joe Kaeser said there were currently no talks with any of these parties.

"There are no talks," Kaeser said, adding that the IPO is still the preferred option for the business.

Following an IPO, analysts expect VDO to achieve a market capitalization of between $9.5 billion and $12.2 billion. However, if the entire business is sold, they think Siemens could receive more than $14 billion for it.

In the second quarter, VDO Automotive’s operating profit slipped to $130 million from $242 million a year earlier, as sales rose to $3.654 billion from $3.556 billion.

In terms of sales, it is the third-largest business in Siemens’s 10 unit conglomerate.

Kaeser also declined to comment on speculation that he will resign from the company, following Kleinfeld’s announcement that he will not ask for a contract extension beyond Sept 30 of this year.