Billed as a transformational milestone in the execution of Siemens’ Vision 2020+ strategy, Siemens Healthineers intends to acquire 100 per cent stakes in US based cancer care leader Varian.
Varian’s solutions, primarily in radiation therapy and related software, generated revenue of $3.2 billion in fiscal 2019, with an adjusted operating margin of approximately 17 per cent.
According to a company release, Siemens AG’s stake in Siemens Healthineers AG will decline to about 72 per cent from 85 per cent, with the parent company reportedly intending to remain long-term majority shareholder in Siemens Healthineers.
Payment of the purchase price of around $16.4 billion is to be enabled by mixed financing from the issuance of new Siemens Healthineers shares and the issuance of bonds. The proceeds from the bonds are to be transferred within the Group to Siemens Healthineers under customary market conditions.
The transaction is expected to close in the first half of calendar year 2021, subject to approval by Varian shareholders, receipt of regulatory approvals and other customary closing conditions.
The transaction will be financed by a combination of equity and debt financing. Siemens AG will not participate in the planned equity increase at Siemens Healthineers AG. The additional debt capital is to be borrowed externally by Siemens in the form of bonds and transferred to Siemens Healthineers via intra-Group loans under customary market conditions. Siemens AG aims to maintain its current A+ / A1 rating.