Investing.com -- Bankers are assembling debt packages of up to €7 billion ($7.9 billion) to finance a potential majority stake sale in Siemens Energy AG's (ETR:ENR1n) steam turbines unit, Bloomberg reported Friday, citing people familiar with the matter. The financing efforts follow the German energy group's announcement in August that it plans to separate the division, which manufactures steam turbines and compressors primarily for industrial clients.
Private equity firms including CVC Capital Partners, EQT AB, and Bain Capital are among the buyout groups evaluating bids for the business, Bloomberg previously reported. The unit, officially known as the Transformation of Industry division, could command a total valuation exceeding €10 billion as Siemens Energy sharpens its focus on core power generation and transmission assets.
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Lenders are pitching debt packages designed to support the transaction through a mix of drawn and undrawn credit facilities. The proposed structures reportedly feature €4.5 billion to €5 billion in drawn debt, including leveraged loans and high-yield bonds, alongside significant undrawn capacity.
To accommodate the unit's operational requirements, bankers are structuring approximately €2.5 billion in undrawn facilities, comprising a €1 billion revolving credit facility and €1.5 billion in guarantee lines. Based on the division's estimated annual earnings of around €900 million, the proposed debt structure would represent a leverage ratio of approximately 5.0 times EBITDA.
The planned divestment underscores Siemens Energy's broader portfolio optimization as the company directs capital toward electricity-focused infrastructure and grid expansion.
Original Article
Bankers assemble €7B debt package for Siemens Energy unit sale - Bloomberg
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