Siemens Energy should not ‘squander’ wind division, investor Deka says

FRANKFURT, Feb 26 (Reuters) – Siemens Energy should not sell its wind division below value, a top-20 shareholder said on Thursday at the group’s annual general meeting, where the future of the struggling business will be a key topic after calls for a spin-off.

The future of Siemens Gamesa, which has weighed on Siemens Energy’s profits for years, has come into sharper focus after U.S. activist shareholder Ananym in December called for a review and spin-off, arguing it would boost shareholder value.

Siemens Energy  leadership has been open in principle to the idea but wants to first stabilise the business, which made a 1.36 billion euro ($1.61 billion) operating loss last year and is expected to break even in 2026.

Investors in Germany have backed the strategy of fixing the business before considering strategic steps.

“To be clear: divesting Gamesa at this point in time would be equal to selling it below its value,” Deka Investment’s Ingo Speich said. “Do not squander away Gamesa.”

Ananym said in a statement it had recently held “very constructive direct discussions” with Siemens Energy’s leadership, adding: “We are largely in agreement in our thinking about Siemens Gamesa”.

Ananym said that even if Siemens Gamesa could be stabilised it was unlikely to reach the margin targets set by the parent.

Siemens Energy has said it wants all of its businesses to generate double-digit margins, far higher than the 3-5% profit margin targeted for Siemens Gamesa by 2028.

“As a result, keeping the wind business even after it has been stabilized is likely to create a continued drag on total company valuation, and will continue to make it difficult for Siemens Gamesa to compete for needed investment capital against the company’s higher-return businesses,” Ananym said.

It reiterated a spin-off would generate substantial shareholder value.