Tuesday 19 March 2024
 
»
 
»
MOVE MAY DERAIL SULZER MERGER

Siemens, GE mull bid for top turbine maker Dresser Rand

FRANKFURT, September 20, 2014

General Electric Company and Germany's Siemens are considering bids for compressor and turbine maker Dresser-Rand that could derail a merger between Dresser-Rand and Swiss pump maker Sulzer, according to media reports.

The Financial Times and Bloomberg reported that Siemens' supervisory board may vote on whether to table a bid at a meeting next week, with Bloomberg citing an offer of more than $85 a share.

General Electric, which has been in talks with Dresser-Rand, is also considering whether to make a bid, people familiar with the matter told the Financial Times.

Siemens and General Electric declined to comment.

Sulzer's biggest shareholder, Russian billionaire Viktor Vekselberg's Renova Group, said in a statement on Friday it held a 4.99 per cent stake in Dresser-Rand. It said it did not intend to comment further.

Shares in Sulzer, whose chairman is former Siemens chief executive Peter Loescher, closed down 4.3 per cent on fears that a move from Siemens could derail its plans for a merger with Dresser-Rand.

Asked about a potential Siemens bid for Dresser, a Sulzer spokeswoman said: "This isn't something we would like to comment on. As we have said before we are in non-exclusive negotiations (with Dresser-Rand). This means that for both parties other options are not excluded."

Germany's Manager Magazin first reported on Friday that Siemens could offer more than $6.1 billion, or $80 per share, for Dresser-Rand.

The turbine maker has been rumored as a takeover target for large industrial companies such as Siemens in recent months.

While Siemens has been working with advisers to assess a potential bid for years, it has not made a takeover offer for the company, people familiar with the matter said.

Sulzer, and other suppliers of pumps and valves for mining, oil and construction firms, are considered ripe for consolidation. Scotland's Weir Group, for example, tried to buy rival Metso but the deal fell apart over price.

A merger with Sulzer would combine Dresser-Rand's compressors and turbines serving the oil and gas industry with Sulzer's industrial pumps, giving the enlarged group a bigger footprint at a time when a North American drilling boom is boosting demand for energy services and equipment.

Dresser-Rand shares closed 9.5 per cent higher at $79.91 on the New York Stock Exchange on Friday. The stock has risen 18 per cent in the last three trading sessions after Sulzer said it was in talks to buy the company.-Reuters




Tags: Siemens | GE | Turbine | Dresser Rand |

More INTERNATIONAL NEWS Stories

calendarCalendar of Events

Ads