German industrial group Siemens AG said on Tuesday it aimed to sell off units with sales volume of about two billion marks as part of a plan to revitalise its industrial businesses.
The company also expected to use acquisitions to lift profitability, bolster its competitive position, and spark annual sales growth of 5.5 percent over the next five years, management board member Edward Krubasik said.
'By the year 2002, we want the majority of our business areas to assume a leading worldwide position,' he said at a news conference to detail the restructuring plans.
Siemens shares rose 3.4 percent to 117.10 marks, as some financial analysts welcomed the measures as the latest in an effort to boost the company's profitability. 'For me this is a step in the right direction,' said Andreas Wahl at Credit Lyonnais. 'I'm looking for Siemens to shake itself up and trim the dead wood from its businesses.' But other analysts said the industrial restructuring marked no acceleration in Siemens' drive to become more competitive, adding that many of the moves had already been announced.
'You shouldn't overestimate the effect in the short-term,' said Klaus Repges at Trinkhaus Capital Management. 'The impact will only come in the long-term, maybe two or three years.'
Krubasik said Siemens would sell the businesses in one or more transactions in the short term, and sought to boost profit at a rate even faster than the 5.5 percent targeted for sales.
Siemens was seeking a partner for an electric generation unit in order to make the 400 million mark business self-supporting, Krubasik said. It was also already in talks with a possible partner for its x-ray analytics and communications metering businesses, which together have sales volume of about 100 million arks.
The divestments were part of a group plan to sell off businesses with sales volume of about 3.5 billion marks over the next year or so. It has been talking to bidders for its defence electronics and dental technology units.
The industrial group includes Siemens' automation, industrial drives and building systems units, and last year generated pretax profit of 524 million marks and sales of 24.7 billion marks
