Siemens president Joe Kaeser said the American firm was “a perfect fit for the Siemens portfolio” while his Dresser-Rand counterpart Vincent R. Volpe Jr said the deal was “a unique opportunity to better serve our clients, employees and shareholders”.
Siemens offer price is $83 per common share in cash, or a total transaction value of approximately $7.6bn. Siemens plans to operate Dresser-Rand as the company’s oil and gas business, retaining the Dresser-Rand brand name and its executive leadership team.
In addition, Siemens intends to maintain a significant presence in Houston, which will be the headquarters location of the oil and gas business of Siemens.
Dresser-Rand manufactures compressors, steam and gas turbines and engines and is a major player in the power generation sector.
Headquartered in Houston it has annual revenues of approximately $3bn and around 8100 staff in the US and Europe.
In a statement, Siemens said the acquisition – which is expected to be completed in summer 2015 – “complements Siemens’ existing offerings, notably for the global oil and gas industry and for distributed power generation”. It added that it plans to “realize more than €150m in annual synergies by 2019 as a result of the transaction”.
Kaeser (pictured right) said: “As the premium brand in the global energy infrastructure markets, Dresser-Rand is a perfect fit for the Siemens portfolio. The combined activities will create a world-class provider for the growing oil and gas markets.”
The board of directors at Dresser-Rand has unanimously recommended the offer to its shareholders.
Volpe said: “Given the vision Siemens has for Dresser-Rand as its oil and gas company, and its expressed wishes to build Dresser-Rand’s product and service portfolio with some of the existing Siemens offerings that have previously been marketed separately into the oil and gas space, it is clear that this is a transaction that should create value for clients, as well as for both sets of shareholders, that would not have otherwise been achieved had Dresser-Rand not become part of the Siemens group.
“Simply stated, we see this as a unique opportunity to better serve our clients, employees and shareholders and are pleased to have Dresser-Rand placed in the central role for Siemens as it develops its position in oil and gas.”
Siemens managing board member Lisa Davis (pictured left) said: “Our aim is to become the leading rotating equipment and process system integrator for the oil and gas industry. Dresser-Rand has a strong presence in oil and gas, a reputation for technology leadership and innovation, and a talented and experienced leadership team.
“Our intention is to leverage these strengths by maintaining the existing company and brand name and selectively moving complementary products and services from the existing Siemens portfolio into Dresser-Rand enabling us to offer a much broader range of products, services and solutions to meet our customers’ needs.”