PRESS: Gazprom Energoholding may enter JV with Siemens

MOSCOW, Mar 11 (PRIME) -- Germany’s Siemens is considering buying a 35% stake of power engineering company Power Machines in Siemens Gas Turbine Technologies, and then selling 50% in the company to Gazprom Energoholding to create a joint venture, Kommersant business daily reported on Monday quoting a source familiar with the negotiations.

According to the business daily, the joint venture agreement of Siemens and Power Machines encompasses a dueling mechanism for priority buyout of stakes of partners. If a side that receives a buyout offer rejects the deal, it has to buy back the partner’s stake at an offered price. The mechanism should be implemented until the end of 2019.

Gazprom Energoholding and Power Machines already held preliminary consultations over the former company buying a stake in Siemens Gas Turbine Technologies, the source told Kommersant.

The source also said that Siemens and Gazprom Energoholding are to raise localization of gas turbine production by the joint venture to 100% from the current figure of 52%, so that the government can use the turbines in a thermal power plants upgrade programme. Gazprom Energoholding should become the anchor holder of the joint venture.

Siemens, Gazprom Energoholding, and Power Machines did not provide a comment.

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