Siemens has entered into an agreement to acquire Invensys Rail, the rail automation business of Invensys for approximately €2.2 billion (£1.742 billion). At the same time, the company plans to divest its baggage handling, postal and parcel sorting activities. Both planned transactions are part of the recently launched "Siemens 2014" company program, which amongst others, is aimed at strengthening the company's core activities. With revenues of approximately £800 million, Invensys Rail is a leading software based rail signaling and control company. The acquisition will expand Siemens' presence in the growing global rail automation market. "Today's moves are important measures to focus our core activities. We are exiting a non-core business with limited synergy potential while strengthening a resilient and high return business by combining two organizations with similar cultures and attractive synergy potential. The combined business will ensure profitable growth opportunities worldwide for the Siemens Infrastructure & Cities Sector," said Roland Busch, CEO of Siemens Infrastructure & Cities. The transaction is subject to Invensys shareholder approval and regulatory clearances.
Siemens continued broad-based revenue growth in the second quarter of fiscal 2012. Revenue in the second quarter rose nine percent year-over-year, supported by a strong order backlog. New orders were down 13 percent. Income was considerably below the prior year due to burdens in the Power Transmission Division and an equity investment loss at NSN. In addition, there had been an extraordinary gain of €1.5 billion on the sale of Siemens' stake in Areva NP in the second quarter of 2011. "As expected, the second quarter was not easy. While we achieved clear growth in revenue, orders came in below the prior year due to lower volume from large orders. For fiscal 2012, we're on course to achieve our goals for revenue and orders. Profit for the quarter was below our expectation due to charges at power transmission projects in Germany," said Siemens President and CEO Peter Löscher.
Siemens ended fiscal 2011 with record operating results and begins the new fiscal year in a position of strength. Total sectors profit climbed by 36 percent to €9.1 billion, income from continuing operations by nearly two-thirds to €7 billion. Revenue and new orders also increased. While revenue from continuing operations grew seven percent to €73.5 billion, new orders rose 16 percent to €85.6 billion. Peter Löscher, President and CEO of Siemens AG stated: "With a strong fourth quarter in a turbulent economic environment, we ended fiscal 2011 with record operating results. With our new organization in four Sectors, we have aligned our business even more closely with our customers. Siemens has a strong portfolio and stands for stability and confidence in troubled times. We are well positioned for moderate revenue growth in fiscal 2012 and surpassing the €100 billion revenue threshold in the medium term."