To avoid a hostile takeover, the German engineering giant hopes to attract investment from sovereign wealth funds
German engineering giant Siemens is looking to attract investment from so-called sovereign wealth funds, despite a political climate in Germany that is hostile to the influence of such funds.
The company's chief financial officer, Joe Kaeser, told the Financial Times Deutschland that Siemens "would very much welcome an active involvement" by such funds. "We are very open to anyone who would want to join us as an investor," he said in comments published on Thursday.
Since CEO Peter Löscher took over the company in July 2007, vowing to get the company through an ongoing corruption scandal, Siemens share prices have plummeted by 31 percent. On Wednesday they closed at €73.36 and the company is deeply concerned about becoming the target of hedge funds or even a possible hostile take-over bid. Siemens only has one major shareholder: members of the Werner von Siemens family. The other 94 percent of the company is owned by diverse shareholders.
Kaeser admitted that the Munich-based conglomerate has been in talks with funds in the Gulf and elsewhere, including Russia. Siemens is cooperating with the Russian steel magnate Alexey Mordashov on a joint venture to build power plant components.
However, there may be fierce political criticism within Germany if Siemens opens itself up to significant foreign investment. Last week the government adopted a bill that would prevent non-European investors from buying more than 25 percent of a German company.
According to the Financial Times Deutschland, Siemens' interest in courting sovereign investment funds has increased since last month when its US rival General Electric (GE) announced a deal with Mubadala, the Abu Dhabi investment fund. CEO Löscher, a former manager at GE, is said to have been impressed by the deal, as was his CFO Kaeser. "That was an important and smart move," he told the paper.