Siemens to Streamline Structure in Strategic Overhaul

   By Nathan Allen 
 

Siemens AG (SIE.XE) will overhaul its existing divisional structure as part of a sweeping realignment aimed at sharpening the group's focus and boosting efficiency, the company said Wednesday.

The group will fold the operations of its five main industrial divisions into three new operating companies that will be called: Gas and Power, Smart Infrastructure and Digital Industries, the German company said.

These will operate alongside Siemens Gamesa Renewable Energy SA (SGRE.MC), Siemens Healthineers AG (SHL.XE), and another new company that will be formed through the merger of Alstom SA (ALO.FR) and Siemens Mobility.

Siemens AG said the aim of the plan is to boost efficiency across the group by giving greater autonomy to individual units.

"Less management from headquarters and more freedom for our businesses will make us stronger and more flexible," Chief Executive Joe Kaeser said.

The new structure, which comes into effect from Oct. 1, should boost annual revenue growth and profit margins at the industrial business by 2% over the medium term, Siemens AG said.

Basic earnings per share should grow faster than revenue over the medium term, the company said.

In addition, Siemens AG said it has agreed to buy specialist-software developer Mendix for 600 million euros ($702.5 million). It is the first investment in a planned push to bolster the company's portfolio in high-growth fields such as distributed-energy management and infrastructure solutions for electric mobility.

"It won't be the biggest companies that survive, but the most adaptable," Mr. Kaeser said.

Write to Nathan Allen at [e-mail]

(END) Dow Jones Newswires

August 01, 2018 13:14 ET (17:14 GMT)

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