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Siemens to test interest of state funds in Healthineers IPO

by Thomas Dworetzky, Contributing Reporter | January 03, 2018
Business Affairs
Siemens will crown its Healthineers spinoff push by looking to sovereign wealth funds to serve as possible anchor investors prior to the planned IPO.

“Internal preparations are going well and we are still planning the listing in the first half of 2018, if markets play along,” Joe Kaeser told Frankfurt Allgemeine Sonntagszeitung in an interview published on Sunday, according to Reuters.

“In any case, we are planning to test the interest of relevant anchor shareholders, including sovereign wealth funds,” he added.

In response to a question concerning the possible inclusion of funds from Norway and China, which have the biggest and third-biggest state funds, Kaeser told the German publication, “we will probably cover the range of the most important state funds, yes. The advantage would be that we would gain anchor investors. The disadvantage: the free float of shares is not as high.”

One reason for the move could be to provide funds for investment in the health care sector for the independent Healthineers down the road, according to Reuters.

The IPO of the Healthineers had been previously slated to happen in the first half of 2018. Present value of the entire division is estimated to be about $48 billion. Sources told the news agency that plans now call for a sale of 15 to 25 percent of the new company during the IPO.

The IPO of the Healthineers is entering its final lap, Kaeser told CNBC in November, 2017.

"We have a fascinating health care business," Kaeser told the network, adding, "and are going to float the business ... because we do believe this is an attractive market and we want to keep control of that business going forward."

As part of the move toward a launch of the unit, the company also appointed Jochen Schmitz to be the chief financial officer of the health care division at that time.

In late October, ripples of the IPO deal made news when Siemens tapped three banks to lead the organization of the effort, and sources told Reuters at the time that Goldman Sachs, Deutsche Bank and JP Morgan will be “global coordinator mandates.”

"Health care technology is a highly attractive business in which we want to further expand our leading position," Kaeser said at that time, adding that "with this step, we continue to implement Vision 2020 launched in May 2014."

The move had really been in the works since 2014, when Siemens created the health care component as a "company within the company." This gave it the ability to be agile enough to adjust to the the massive transformations sweeping the health care market.

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