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Siemens and Alstom join forces to create a star player in mobility

Siemens and Alstom have signed a Memorandum of Understanding to combine Siemens' mobility business including its rail traction drives business, with Alstom.
The two businesses are largely complementary in terms of activities and geographies. Siemens will receive newly issued shares in the combined company representing 50% of Alstom's share capital on a fully diluted basis, a press release reads.

"This Franco-German merger of equals sends a strong signal in many ways. We put the European idea to work and together with our friends at Alstom, we are creating a new European champion in the rail industry for the long term. This will give our customers around the world a more innovative and more competitive portfolio", said Joe Kaeser, President and CEO of Siemens AG.

“The global market-place has changed significantly over the last few years. A dominant player in Asia has changed global market dynamics and digitalization will impact the future of mobility. Together, we can offer more choices and will be driving this transformation for our customers, employees and shareholders in a responsible and sustainable way", Kaeser added.

The new entity will benefit from an order backlog of EUR 61.2 billion, revenue of EUR 15.3 billion, an adjusted EBIT of EUR 1.2 billion and an adjusted EBIT-margin of 8.0 percent, based on information extracted from the last annual financial statements of Alstom and Siemens.

In a combined setup, Siemens and Alstom expect to generate annual synergies of EUR 470 million latest in year four post-closing and targets net-cash at closing between EUR 0.5 billion to EUR 1.0 billion. Global headquarters as well as the management team for rolling stock will be located in Paris area and the combined entity will remain listed in France.

Headquarters for the Mobility Solutions business will be located in Berlin, Germany. In total, the new entity will have 62’300 employees in over 60 countries.

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August 20 2018 3:56 pm V10.1.0-1