Siemens Plans Automotive IPO, Buys PLM Software CompanySiemens Plans Automotive IPO, Buys PLM Software Company

MUNICH, Germany — Ahead of its shareholders Meeting Jan. 25 here, Siemens announced two moves intended to improve its focus on its core business: The German conglomerate intends to spin off its Automotive electronics branch Siemens VDO and it plans to acquire U.S. based manufacturing automation software vendor UGS Corp (Plano, Texas).

The Initial Public Offering of Siemens VDO will bring the company more flexibility, Siemens said in a press release. With sales of € 10 billion ($13 billion); Siemens VDO is one of the largest groups within the Siemens concern. "An IPO would give Siemens VDO greater flexibility, reinforce its position in automotive electronics, and actively tap the market consolidation opportunities for its growth", said Siemens CEO Klaus Kleinfeld.

Siemens plans to hold a majority stake in the company. Further details have not yet been finalized.

With the acquisition of UGS Corp., the Siemens Automation and Drives (A&D) group intends to expand its product spectrum in automation technology to include industrial software for planning, design, and simulation for Product Lifecycle Management (PLM). With the UGS products, Siemens A&D wants to complete its "digital factory" strategy.

According to the Siemens release, UGS in fiscal 2005 generated just under $1.2 billion in sales. The market for PLM software and services is estimated to a volume of about $13 billion annually with growth rates of 7 to 9 percent.

The acquisition is subject to approval by the relevant authorities.

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