Siemens sells SNS to "optimise portfolio"

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Siemens sells SNS to "optimise portfolio"

The top level networking and integrator market has shown signs of further consolidation after Siemens sold its Network Systems arm to private equity group Kohlberg Kravis and Roberts for an undisclosed amount.

Siemens claimed it sold the division - which turned over E400m (£251m) last year and employed around 860 staff in the UK, France and Italy - as part of its drive to "optimise its portfolio" of companies.

The networking group also revealed it was selling a number of other divisions to KKR, including Mannesmann Plastics Machinery, Demag Cranes and Components and its ceramics arm. An SNS spokeswoman told MicroScope she did not believe KKR bought the companies simply to immediately sell them on again.

"KKR tends to hang on to companies for a long time, keep the same management, grow the business and take them to IPO," she said.

Keith Humphreys, consultant at EuroLAN Research, argued Siemens had been seeking to exit the integrator market because SNS did not fit with its overall model.

He said the networking group might also have wanted to get rid of the division because its vendor focus had moved away from Siemens products.

"It was apparently unhappy because SNS sold mostly Cisco and 3Com product, so it was not really an asset," he revealed.

Humphreys added that all the likely contenders large enough to show an interest in buying SNS from KKR, such as Cable & Wireless, DiData and Datatec, "all had their own problems".

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