Siemens seals fate of its mobile communications arm
Siemens Mobile, the troubled mobile communications manufacturer has been sold to BenQ in a multimillion Euro deal that seals the fate of the troubled arm of Siemens AG.Siemens Mobile has been costing Siemens AG an estimated 1.5 million Euros a day to keep afloat and Siemens AG have been desperate to offload the troubled unit for months now.
Sealing the 350 million Euro deal has mean that Siemens has effectively paid BenQ to take it off its hands, but at the same time, Siemens AG will pick up a 2.5% stake in BenQ, the Taiwanese technology group. The deal is expected to be closed towards the middle of September 2005, with BenQ taking full control from October the 1st 2005.
The sell off sees BenQ’s rise into the top 10 handset vendors in the world with an estimated market share of around 12%, analysts have been quoted as saying BenQ will require a market share of 15% to see profits returned in the venture so there is still work to be done.
With the headquarters of the new business remaining in Munich, Germany, the 6,000 Siemens employees will transfer to BenQ to work on the future of the business, although with union systems in Germany over 3,000 of the employees are already guaranteed a job until 2006 through strict work union policies in the country.
