State guarantees up to 7.5 billion euros for Siemens Energy
According to negotiating circles, the decisive details have been clarified in the struggle for state support for order guarantees for Siemens Energy. Major shareholder Siemens has also agreed to participate. The agreement is to be announced in the middle of the week when the energy technology group presents its financial statements.
According to negotiating circles, a concrete solution is on the table in the weeks-long tug-of-war over guarantees worth billions for the energy technology group Siemens Energy. According to three people familiar with the plans, 12 billion of the required 15 billion euros in guarantees for future major projects are to come from the banks, with the federal government covering a maximum of 7.5 billion euros if necessary.
The former parent company Siemens AG, which still holds 25.1 percent of Siemens Energy, will not provide any guarantees itself, the insiders emphasized. However, Siemens AG is buying an 18 percent stake in the joint Indian subsidiary from Siemens Energy for more than two billion euros, thus strengthening the balance sheet of the Munich-based energy technology group.
"This makes it possible for others to provide the guarantees," said one of the insiders. In the course of the negotiations, the federal government had insisted on Siemens AG's participation. Initially, there had been talk of the banks and the federal government sharing the first ten billion euros in guarantees, with Siemens AG contributing the remaining five billion euros.
It initially remained unclear where the remaining three billion euros would come from. However, there is also a solution for this, said one of the insiders. Siemens and Siemens Energy did not want to comment on the information, while the Federal Ministry of Economics and Technology said through a spokesperson that there was no new status. According to Reuters information, the approval of the supervisory boards of both companies is still pending. Siemens Energy intends to present the results at the latest at the annual press conference in Munich on Wednesday.
Help is not entirely altruistic
Siemens Energy had turned to politicians with the request for guarantees. This was because the banks were reluctant to assume the implementation risks for major projects worth more than 100 billion euros on Siemens Energy's books alone due to the deterioration in its credit rating. The company pointed out that its foreign competitors also benefited from state guarantees. However, Siemens AG was reluctant to become more involved in this area again following the spin-off of its energy technology business three years ago.
The technology group had already reduced its guarantees for energy projects from the joint times to seven billion euros. It is now only indirectly supporting the former subsidiary - and not entirely altruistically: according to insiders, Siemens AG is increasing its stake in the Indian business to 69 percent from the previous 51 percent.
The listed company Siemens Ltd was not unbundled for tax reasons when the group was split up. According to an insider, the five percent of Siemens Ltd remaining with Siemens Energy serves as collateral for guarantees. In addition, the technology group Siemens Energy will defer the 250 million euros due annually for the use of the rights to the "Siemens" brand, but will receive interest in return.
The Federal Ministry of Economics is involved in negotiations to provide up to 7.5 billion euros in state guarantees for Siemens Energy, as the energy supplier faces challenges in securing financing due to its declining creditworthiness. Despite this, major banks are expected to provide 12 billion euros of the required guarantees for future projects, with Siemens AG not contributing any guarantees itself but buying an 18% stake in a joint Indian subsidiary.
Source: www.ntv.de
