Siemens Energy to carve out Transformation of Industry unit as power-sector capital demands sharpen
The capex cycle in power generation and grid infrastructure has become sharp enough to force portfolio choices at the largest European energy technology groups. Siemens Energy said Tuesday it has begun legal and operational…
Key takeaways
- Siemens Energy said Tuesday it has begun legal and operational preparations to separate its Transformation of Industry division, which will operate under the Omterra brand.
- The unit generated €5.7 billion in revenue in fiscal 2025, employs around 17,000 people, and represents roughly 15% of Siemens Energy's €39.1 billion group revenue.
- Siemens Energy plans to deconsolidate the unit while retaining a meaningful minority stake, citing that it competes for capital against faster-growing power and grid businesses.
- The division reported an 11.3% profit margin before special items and 13.5% comparable revenue growth in fiscal 2025, with 5% to 7% growth forecast for fiscal 2026.
- Siemens Energy will explore a new ownership structure that could include outside investors or a capital markets transaction, with no terms or timeline given.
The capex cycle in power generation and grid infrastructure has become sharp enough to force portfolio choices at the largest European energy technology groups. Siemens Energy said Tuesday it has begun legal and operational preparations to separate its Transformation of Industry division, a business that generated €5.7 billion in revenue in fiscal 2025 and employs around 17,000 people. The company intends to deconsolidate the unit while retaining what it described as a meaningful minority stake.
The separation turns on a capital rationing argument. Chief Executive Christian Bruch has said the Transformation of Industry unit has become profitable and is growing, but competes for investment against Siemens Energy operations offering faster growth and higher near-term returns. Grid Technologies is expected to post comparable revenue growth of 25% to 27% in fiscal 2026, Siemens Energy has said, while Gas Services is targeting 16% to 18%. Those rates pull capital toward the power and transmission side, leaving the industrial unit structurally disadvantaged inside the current group.
The division stands on its own financially. Transformation of Industry reported an 11.3% profit margin before special items in fiscal 2025, with comparable revenue growth of 13.5%, and the company has forecast another 5% to 7% comparable revenue growth in fiscal 2026 with a margin before special items of between 11% and 13%. Once separated, the unit will operate under the Omterra brand.
The business supplies industrial steam turbines, compressors, generators, motors, hydrogen electrolyzers and maritime and subsea technologies to customers across oil and gas, chemicals, process industries, cement, paper, data centers and shipping. Service revenues account for roughly half the total, and the division has more than 85,000 installed units worldwide. Manufacturing facilities span Germany and sites across Europe, the United States, India, China, Brazil and Saudi Arabia.
For the broader energy sector, the carve-out arrives as energy security concerns and rising power demand are pulling investment toward conventional and lower-carbon infrastructure in parallel. An independent Omterra would be a sizable supplier to oil and gas, industrial decarbonization and hydrogen markets. Siemens Energy generated €39.1 billion in total revenue in fiscal 2025, making Transformation of Industry roughly 15% of group sales. The remaining portfolio, including Siemens Gamesa wind operations alongside grid and gas businesses, would carry a markedly different growth profile after deconsolidation.
The ownership path for Omterra remains open. Siemens Energy said it would explore a new ownership structure that could include outside investors or a capital markets transaction, with no terms or timeline given. How that transaction is priced, and when, will depend on what markets will bear when the separation is ready to proceed.
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