Link to Siemens news of major restructuring
infoseek.go.com
Part of release from Reuters link above:
MUNICH, Feb 18 (Reuters) - Germany's Siemens AG on Thursday said it would not change sales and profit forecasts for this year despite a wage deal that will push up labour costs, and emphasised it was determined to stay independent.
It also announced plans to spin off its semiconductor unit in the middle of the year, while continuing to look out for attractive acquisition opportunities.
The wage deal, struck early on Thursday between metal and engineering workers union IG Metall and employers in Baden-Wuerttemberg, would increase annual costs by between 800 million marks and 900 million marks ($460-518 million), Chief Executive Heinrich von Pierer told journalists before a shareholders meeting.
Siemens shares closed up 3.02%
Addressing more than 10,000 shareholders, von Pierer and the management and advisory board faced harsh criticism from many present, angered by the group's substantially lower 1997/98 profit. They called Siemens' business strategy ''inadequate.''
Giving a detailed account of Siemens performance last year and this year's expectations, von Pierer faced calls for his resignation but the majority of shareholders, nevertheless, gave their support to Siemens management and advisory boards.
The meeting concluded late Thursday with a substantial majority voting in favour of previously announced proposals like raising nominal capital of up to 350 million marks if necessary and paying a dividend of 1.50 marks for 1997/98.
Von Pierer said Siemens' semiconductor unit would become a separate company early this summer, with its flotation planned for late 1999 or early 2000.
Spinning this unit off is part of a giant restructuring plan, announced last year, which aims to shed businesses with sales of about 17 billion marks and a workforce of 60,000.
Among the harshest critics at the meeting were employee shareholders who demanded that von Pierer accept a social responsibility toward Siemens labour force and not concentrate only on satisfying private investors and fund managers.
Siemens said it needed to divest its semiconductors unit due to its extraordinarily capital-intensive nature and because the sector was subject to extreme price cycles.
Siemens would also consider a flotation of Siemens Nixdorf retail and banking systems and planned to sell its copper cable business, von Pierer said, adding that a decision on both of these cases would be reached in a matter of weeks. <<<<<<<<<<<<<<<<<<
end of partial quote from release |
