Siemens AG said it is selling several noncore businesses, including its metering business, to U.S. private equity firm Kohlberg Kravis Roberts & Co. (KKR) for $1.69 billion.
The businesses will be transferred to a new Luxembourg-based holding company called Demag Holding in which KKR will have an 81 percent stake and Siemens a 19 percent stake, but they will be separately managed.
Siemens Metering is headquartered in Zug, Switzerland, and is a product business of Siemens' Power Transmission & Distribution Group. Siemens' U.S. metering operations, located in Lafayette, Ind., and Reynosa, Mexico, are included in the sale to KKR. The two locations of Lafayette and Reynosa currently employ 450 people.
The transaction would become effective upon anti-trust approval by the European Commission. The anticipated date is Sept. 30. Once approved, the new company would operate under the name Landis & Gyr. The financial terms of the transaction were not disclosed.
Siemens's metering business is the second electrical business in which KKR has taken an interest in recent months. KKR and Wendel Investissement, a French conglomerate, recently signed an agreement to buy Legrand for $3.6 billion from Schneider Electric. Schneider bought Legrand in July 2001, but European regulators blocked the deal on antitrust grounds last October. Schneider is appealing the ruling and could still hold onto Legrand if it wins its appeal to the European Union Commission.