Private Equity Circles Siemens Energy's Steam Turbine Business as Conglomerate Slims Down

CVC, EQT, Bain, Brookfield, KKR eye majority stake in Siemens Energy's steam turbine unit, valued above €10B, amid broader Omterra split.

The auction for Siemens Energy's steam turbine division is drawing heavyweight interest, with CVC Capital Partners, EQT, Bain Capital, Brookfield and KKR all reportedly weighing bids for a majority stake. Bloomberg has identified Goldman Sachs as the mandated adviser on the sale process, and the business could command a valuation north of €10 billion.

The move dovetails with a broader corporate overhaul at the Munich-based group. Management recently firmed up the timetable for legally separating the "Transformation of Industry" unit, which will be rebranded as Omterra — a name that will also encompass Siemens Gamesa Renewable Energy. The rebranding is slated to roll out in stages beginning this calendar year.

Rather than the pure deconsolidation with a retained minority stake that Siemens Energy originally sketched out, the Bloomberg report points toward a more direct route: selling a controlling interest to institutional investors outright. That would inject fresh capital while raising questions about how much operational sway the parent keeps over the long haul.

A Business That Still Prints Money

The interest from buyout shops underscores the strategic value of a division that has increasingly been viewed as peripheral to Siemens Energy's core ambitions. The unit employs roughly 17,000 people and generated €5.7 billion in revenue in fiscal 2025, with a profit margin of 11.3 percent.

Meanwhile, the parent company's operating engine shows no signs of stalling. Third-quarter results published in early August revealed revenue of €11.45 billion, up 17.47 percent year on year, while earnings per share jumped from €0.71 to €1.28. Order intake hit a record €17.9 billion, pushing the backlog to an all-time high of €162 billion.

About a fifth of new orders now stem from energy infrastructure for AI data centers — a growth pocket that commands far more investor attention than the legacy turbine franchise. Management also reaffirmed its fiscal 2026 guidance during recent investor discussions, sticking with an underlying margin forecast of 10 to 12 percent and net income of roughly €4 billion.

Market Jitters Over Competition and Valuation

The share price tells a more cautious story. On Monday, the stock fell 4.3 percent to close at €142.66, leaving it down 6.9 percent on the week. That puts the shares roughly 27 percent below their 52-week high of €195.38, reached in April, with the relative strength index at 38.4 — territory that typically signals oversold conditions.

The drag comes less from the divestment plans themselves than from reports that SpaceX could move into manufacturing its own gas turbines for data centers. That prospect of competition from outside the industry, layered on top of lingering uncertainty about how Omterra's separation will be valued, has left investors struggling to pin down a fair price for the conglomerate.

The steam turbine sale is unlikely to resolve that ambiguity in the near term. But a successful deal at an attractive price could eventually serve as tangible proof that the restructuring effort is resonating with outside capital.

Positive Signals Elsewhere

Operational momentum continues to build on other fronts. Ocean Breeze Energy, operator of the Bard Offshore 1 wind farm in the North Sea, has handed Siemens Energy a contract worth millions to modernize frequency converters across 80 turbines. The Indian subsidiary added its own bright spot, reporting net profit up 52.4 percent for the quarter.

The key open question is whether the rumored €10 billion-plus valuation can actually be realized — and which of the named suitors will convert preliminary interest into a binding offer. Until then, the stock looks set to remain hostage to the twists and turns of the sale process and the broader restructuring narrative.