Siemens apparently is so confident in its healthcare division — despite all the ridicule from changing the name to Siemens Healthineers earlier this year — that the German industrial conglomerate is planning an initial public offering for that business.
Siemens made the announcement Thursday at its annual corporate press conference in Munich, which coincided with the release of its fiscal 4th quarter results. Net income for the umbrella corporation rose by 20 percent in the quarter ended Sept. 30, to €1.15 billion ($1.25 billion) from €959 million ($1.04 billion) a year earlier.
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Profits in the Healthineers division was flat, at €696 million ($758.3 million). Healthcare-related revenues edged up in the fourth quarter, to €3.85 billion ($4.2 billion), from €3.82 billion ($4.16 billion) in the same period of 2015.
Erlangen, Germany-based Siemens did not indicate when the Healthineers IPO would take place, how much the company would try to raise or where shares would be listed. CFO Ralf Thomas said the parent firm would retain a majority stake in the healthcare business, the Wall Street Journal reported.
The healthcare business was set up as a separate “company within the company” following the launch of a new corporate strategy in 2014. Siemens announced the Healthineers name in May 2016.
“The public listing is now the next step in further strengthening Siemens Healthineers in Siemens for the future. We’re implementing this from an already leading position,” Siemens President and CEO Joe Kaeser said in a press release.
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“The public listing is a key lever for reaching our strategic goal of being THE enabler for healthcare providers worldwide,” Siemens Healthineers CEO Bernd Montag added in the same release (emphasis in original).
“Greater entrepreneurial freedom and agility will allow us to help shape the development of the global healthcare market and the growth strategies of successful healthcare providers. We’ll enable our customers to participate successfully in the trends toward consolidation, industrialization and holistic health management with a high degree of clinical relevance, efficient workflows and financial value added,” Montag continued.
Siemens shed its health IT business in early 2015, selling that U.S.-based unit, once known as Shared Medical Systems, to Cerner. What is now called Healthineers includes medical devices, diagnostic equipment and telehealth.
A month ago, the company got into population health management, courtesy of a strategic alliance with IBM Watson Health.
Photo: Siemens