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Siemens plans IPO for its Healthineers unit, with US headquarters in Malvern

Tom Paine

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Siemens announced during its earnings call last week that it is planning a partial spinoff of its healthcare unit through an IPO, though a time frame wasn't specified and and one analyst said it might not happen for a couple of years.

Some in the Philadelphia area may have thought Siemens was gone from Malvern after it sold its Health Services unit (originally Shared Medical Systems) to Cerner for $1.3 billion in early 2015, but Malvern is still US headquarters for what Siemens rebranded earlier this year as Siemens Healthineers, with about 1,000 employees based there, Siemens told me in response to an email. Its a $15 billion annual business worldwide.

Strengths are in systems for medical imaging, laboratory diagnostics, and point of care testing, as well as hearing instruments, though it's weaker in some segments than in others.

Siemens CEO Joe Kaeser indicated that Siemens would definitely retain a significant stake, but I heard differing messages to whether or not it would be a controlling stake. Siemens had determined that healthcare was not a core business, but wanted to keep a
hand in it while allowing independence to become more entrepreneurial.

David Pacitti, President of Siemens Medical Solutions USA, Inc. and Head of Siemens
David Pacitti
Healthineers North America, is a Philadelphia area native and Villanova graduate. At Villanova, his football play earned him induction into the Villanova Varsity Club Hall of Fame in 2006.

This year, Siemens Healthineers and IBM Watson Health formed a Global Alliance for Population Health Management. Siemens Healthineers also introduced a new business line in the US, known as Enterprise Services (ES), aimed at helping to improve the overall hospital environment.

Having shed some of its consumer businesses and refocusing on industrial markets, Siemens may be showing more aggressiveness after a period of relative retrenchment. Last week's announcement of an equity investment and joint development initiative with Exton-based Bentley Systems was significant, though not huge by Siemens standards. And just today Siemens announced a $4.5 billion acquisition of Oregon-based Mentor Graphics, whose software helps companies design computer chips.