Siemens Gamesa's India wind biz up for sale at $1 billion valuation

The India business is said to have annual revenues of $700 million, and is being valued at $1 billion for the transaction.
The India business is said to have annual revenues of $700 million, and is being valued at $1 billion for the transaction.


Siemens Gamesa is expecting to break even by 2026 and is now choosing to focus only on the US and European markets.

Mumbai: Looking to cut losses and return its wind turbine business to profitability by 2026, German energy major Siemens Energy AG has put the India wind turbine unit of its subsidiary, Siemens Gamesa Renewable Energy, up for sale, two people aware of the development said.

The India business is said to have annual revenues of $700 million, and is being valued at $1 billion for the transaction, the people said.

The Munich-headquartered global manufacturer has appointed investment bank Barclays to find buyers. The appointment follows the parent’s decision to explore either part or full exit of the wind turbine unit from the Indian market.

“Adani is one of the front runners to this asset," the first person said. In addition to Adani Renewable Energy, TPG Rise, Brookfield Energy Transition Funds, Macquarie, and middle eastern energy company Masdar have also been sounded out, the second person said. Both persons spoke on condition of anonymity.

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“The deal could swing from a significant minority stake to a control deal based on investor interest," the second person added.

A Siemens spokesperson did not specifically comment on the deal.

“Siemens Gamesa recently presented a plan on how we can return the company to profitability. Part of this action plan is also the focus on core markets in the onshore sector, that is, with wind turbines on land. Here, the company will concentrate on the core markets of Europe and the US, but will also serve other markets where profitable business is possible. Further detailed decisions have not yet been made. The Indian market is fundamentally interesting for us; we have service obligations here that we will of course fulfil," the spokesperson said.

The prospective buyers did not immediately respond to a request for comment. Barclays did not immediately comment on Friday evening.

“The deal was launched last week. Initial teasers have been sent out to infrastructure funds, climate funds and strategic investors," said the second person cited above.

Why the sale

Siemens Gamesa has reported poor results over the past few years and has been working on a turnaround. Siemens projected negative profit of €2 billion for Siemens Gamesa for fiscal 2024, per its Q2 FY24 earnings. (For Siemens Energy AG, fiscal calendar 2024 ends in September 2024.)

In November, Siemens Energy chief executive Christian Bruch said Siemens Gamesa was aiming to break even by 2026.

This followed Siemens Energy initiating the process to acquire all the outstanding shares of Siemens Gamesa in May 2022 with a plan to fully integrate the two units over 2024 and 2025. From 1 August, Siemens Gamesa has appointed Vinod Phillip as chief executive officer, who takes over from Jochen Eickholt. From 1 June, the integration of Siemens Energy and Siemens Gamesa will begin.

Earlier this month, Bruch told analysts that Siemens Gamesa was still working through the resolution of the quality matters and the offshore ramp-up.

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“We will only focus on attractive markets where we have a stable regulatory framework and attractive profit pool, and a value-based customer landscape and where there's a match between the market requirements and our offering," he said, presenting a turnaround plan on 8 May during the company’s earnings call.

“We may also serve other markets opportunistically, but only if it makes real commercial sense," he added, noting that Europe and the US fit this criteria and it will ramp up operations in these geographies.

“We will not try to defend markets in which there is no money to be made in the medium term as far as margins are concerned," Bruch told Recharge, an energy-focused news platform on 8 May, referring to Siemens Gamesa.

The India windscape

In India, Siemens Gamesa set up in 2009, and has an installed capacity of 9 GW. The company has blade factories in Nellore (Andhra Pradesh), a nacelle factory in Mamandur (Chennai, Tamil Nadu), and an operations and maintenance centre in Red Hills (Chennai). The company is market leader with a 40% market share, according to consultancy Wood Mackenzie.

In the Indian market, Gamesa competes with players such as Suzlon Energy, which is listed on the bourses and has seen a surge in its stock price post a restructuring of debt, in which its lenders reportedly took a haircut of 62%.

“The performance of Suzlon on the stock market also gives a lot of comfort to other EPC players such as Gamesa on the lucrative valuation that they can extract," the second person added. “There has been a rerating in the industry and Gamesa will benefit from it."

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Meanwhile, on 14 May, BSE-listed Siemens Ltd said it will demerge and separately list its energy business, on the lines of a global carve-out by its German parent three years ago. The new company will mirror the shareholding of Siemens Ltd, and shareholders will receive one share of Siemens Energy India Ltd for every share of Siemens Ltd.


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