Siemens prepares sale of security products unit

Unit offers products such as security cameras and access card reader We are focusing on security solutions that are part of our building automation solution. But doing a security system, per se, stand- alone, we just don’t have the products to make a viab

Siemens AG is preparing a sale of its security products business as Europe’s biggest engineering company combs through its portfolio to weed out laggards.

The company hired investment bank Rothschild for a sale of the unit, which has fewer than 350 employees and offers products such as security cameras and access card readers, according to three people familiar with the matter who declined to be identified as the process isn’t public.

Roland Busch, the head of the infrastructure and cities division, said in an interview in Davos last week that its security products unit doesn’t have a “viable business case” as a stand- alone entity. He also said he’ll retain the low- and medium- voltage transmissions unit, countering speculation that it may be sold for as much as € 1 billion ($ 1.3 billion).

Siemens Chief Executive Officer Peter Loescher, on his second five- year term, has come under pressure to boost profitability and refocus the Munich- based company after some deals that he supervised soured, and a push into more environmentally friendly energy generation led to spiraling costs. Busch’s sector, formed in 2011 to better serve municipal clients as a one- stop shop, last week posted the lowest profitability of the company’s four main sectors in the three months through December.

The Solna, Sweden- based security products unit is separate from the security solutions business. The former manufactures the products while the latter focuses on their implementation within more complex facility management systems.

Offloading

“We are focusing on security solutions that are part of our building automation solution,” said Busch, whose sector is also selling building technology, smart grids, train manufacturing and rail automation equipment. “But doing a security system, per se, stand- alone, we just don’t have the products to make a viable business case.”

Siemens, which last week reported a decline in profits and rising costs for the three months through December, is already planning to offload units such as airport luggage systems, mail automation and water technology after shareholders approved the spinoff of the underperforming Osram lighting unit.

Siemens spokesman Philipp Encz declined to comment on potential further assets sales. A spokesman for Rothschild also declined to comment.