Siemens AG is expected to detail on Thursday its strategy for divesting Siemens Healthineers, its subsidiary specializing in medical imaging and diagnostics, which has a market capitalization of €48 billion. The parent company's 71.1% stake is worth around €34.6 billion based on current share prices.
This major move would give CEO Roland Busch significant leeway to revive the industrial conglomerate's external growth momentum. Since Healthineers' IPO in 2018, Siemens has gradually reduced its stake, which now stands at just under 70%, after selling 2% last February for around €1.45 billion.
Divestment to reinvest in AI and software
This new step could mark a strategic turning point in Roland Busch's tenure, whose contract runs until 2030. Some investors, such as Deka Investment, would like to see Siemens quickly reduce its stake to 51%, or even below 50%, in order to focus its resources on its future businesses, particularly artificial intelligence and industrial software. For Ingo Speich, head of governance at Deka, Busch has delivered solid results but has yet to establish a strong long-term vision: an ambitious decision on Healthineers would be an opportunity to strengthen his legacy and refocus the group around its technological pillars.
Dividend in kind? Gradual sale? Another option?
Several scenarios are being considered for this reduction in ownership. Siemens could distribute Healthineers shares to its shareholders as a dividend in kind, place them in a dedicated entity before spinning them off, or proceed with gradual sales on the market. Each of these options has complex tax, legal, and financial implications.
According to JP Morgan, a direct distribution of two-thirds of the stake would generate a tax bill of €7 billion in Germany. In the meantime, Healthineers is suffering from ongoing uncertainty, with its share price down 15% this year, while Siemens has gained 31% over the same period, buoyed by expectations of a strategic reallocation of its resources and exposure to AI through the revival of the energy sector (via its subsidiary Siemens Energy) and its presence in automation software.
