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Siemens: Unit sale near
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October 18, 1999: 7:30 a.m. ET
KKR seen as likely buyer for Nixdorf banking systems division
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LONDON (CNNfn) - Siemens, the German industrial company, said Monday that it was close to selling its banking systems arm -- with a consortium including U.S. buyout specialist Kohlberg Kravis & Roberts (KKR) widely believed to be the buyer.
Siemens announced plans to spin off the unit last November as part of a broader restructuring program before a planned U.S. listing next year. The company is also believed to be close to establishing a new transport systems joint venture with Canada's Bombardier.
The Siemens Nixdorf banking unit, which specializes in manufacturing automated teller machines, had sales of $1.06 billion last year and is valued by analysts at around $750 million.
Siemens confirmed it was close to a final agreement, but declined to identify KKR as the potential buyer.
KKR is one of a string of U.S. buyout and venture capital firms that have expanded into Europe to take advantage of accelerating corporate restructuring.
The company established a London office and has eyed deals in the chemical, utility and telecom sector. Armed with a $3.5 billion fund, KKR has secured U.K. deals -- including the purchase of insurance broker Willis Corroon -- but has yet to close a deal on the European mainland. It was linked earlier this month with a $500 million bid for the telecom assets of Germany's Bosch.
Texas Pacific, another U.S. leveraged buyout specialist, has already acquired stakes in U.K. pub operator Punch Taverns and Bally, an upscale Swiss-based shoe retailer.
KKR declined to confirm that it was close to a deal, but a successful closing would rank as one of the largest U.S.-originated European buyouts. The firm is reported to have beaten off competing offers from British venture capital firm Cinven and ICL, a U.K. subsidiary of Japanese electronics giant Fujitsu.
Siemens had considered a management buyout and an offering of the Nixdorf unit before settling for a straight sale.
Siemens is also looking to consolidate its eight transport units -- which specialize in the making of trains and trams -- and has been linked with a 50:50 joint venture with Bombardier. The company declined to comment on the reports.
Siemens shares slid 1.5 percent Monday morning in a generally downbeat Frankfurt stock market.
-- from staff and wire reports
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