Siemens Finance Head Kaeser Says Osram IPO Windfall May Go to Shareholders

Siemens AG (SIE), which is planning an initial public offering of lighting unit Osram, will consider distributing proceeds from the share sale to investors as it shies away from pricey acquisitions, Chief Financial Officer Joe Kaeser said in an interview.

No final decision has been made on how to use the Osram proceeds, though shareholders are the “natural owners” of the cash, Kaeser said yesterday, when asked about a special payout. Siemens may raise 3 billion euros ($4.2 billion) in the sale, a person familiar with the plan said May 25.

The company is loath to become swept along in a surge of mergers and acquisitions among industrial manufacturers. ABB Ltd. (ABBN) and Schneider Electric SA (SU) have announced a combined $10 billion in industrial and technology deals since the start of 2010. General Electric Co. (GE) has announced 21 such deals for a total $7.3 billion, Bloomberg data shows.

“We believe there’s a smarter way to go about acquisitions,” Kaeser said in the interview in Washington, D.C. “That is why we believe in keeping the money” to “strike” at the right time, he said.

Siemens, based in Munich, has a policy to return money to shareholders if debt “consistently” stays below a target ratio of 0.5 to 1.0 times earnings before interest, taxes, depreciation and amortization. In the first six months of the current fiscal year, that measure stood at a minus 0.1 in the absence of debt-financed acquisitions.


The company paid a record dividend of 2.70 euros a share last year. That payout is set to rise to 3.18 euros for this year, according to the average estimate of 27 analysts in a Bloomberg survey.

Europe’s largest engineer has doubled its cash holdings in three years to 18.5 billion euros, the second-biggest war chest among peers, according to Bloomberg data. So far, it’s been a largely untapped resource.

Siemens has used just 1.5 billion euros for takeovers since Chief Executive Officer Peter Loescher’s first deal, the $7 billion purchase of Dade Behring in 2007, was criticized as too costly by investors. Kaeser on April 5 said recent acquisitions in the industry had been “richly priced.”

“Siemens’ competitors have been very active,” said Theo Kitz, an analyst at Merck Finck & Co. in Munich. “Schneider is buying lots of companies active in energy efficiency. It’s not like they’ve emptied the shop, but the trend is towards that. That’s a danger for those who remain inactive.”

To contact the reporter on this story: Richard Weiss in Frankfurt at Brian Wingfield in Washington at

To contact the editors responsible for this story: Benedikt Kammel at

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