Strategic Realignment in Motion: Analyzing Siemens’ ₹2,200 Crore Divestiture to Innomotics India 

In a strategic realignment triggered by its parent company’s global divestiture, Siemens Limited has agreed to sell its Low Voltage Motors and Geared Motors business to Innomotics India Private Limited for ₹2,200 crore. Structured as a slump sale, this move resolves Siemens Limited’s untenable position of operating a business dependent on intellectual property it no longer owned after Siemens AG sold the global Innomotics entity. For the buyer, Innomotics India—a subsidiary of the now-independent Innomotics—the acquisition is a transformative step to unify its portfolio and strengthen its brand presence across India. The transaction, expected to close by mid-2026 pending regulatory approvals, exemplifies calculated corporate restructuring, allowing Siemens to focus on its core technology domains while enabling Innomotics to become a formidable, integrated player in the Indian market.

Strategic Realignment in Motion: Analyzing Siemens’ ₹2,200 Crore Divestiture to Innomotics India 

In a landmark transaction reshaping India’s industrial technology landscape, Siemens Limited has executed a definitive agreement to sell its Low Voltage Motors and Geared Motors business to Innomotics India Private Limited for an enterprise value of ₹2,200 crore (approximately $265 million). Structured as a “slump sale” of a going concern, this cash-free, debt-free deal marks a significant strategic pivot for Siemens and a major portfolio expansion for Innomotics, spotlighting the ongoing global and local restructuring within the industrial manufacturing sector. 

The transaction, approved by the Siemens Limited board on December 8, 2025, is not merely a transfer of assets but a calculated corporate maneuver with deep-rooted strategic causes and wide-ranging implications for customers, employees, and the competitive market. 

The Strategic Imperative Behind the Sale 

The divestment finds its primary rationale in a global corporate realignment that preceded it. On October 1, 2024, Siemens AG, the German parent company, completed the sale of the entire Innomotics GmbH global entity to private equity firm KPS Capital Partners. This global sale included the transfer of all related intellectual property (IP) rights for motor technologies to the new owner, KPS. 

Consequently, the Indian subsidiary, Siemens Limited, found itself in an untenable position. The Low Voltage Motors business it operated was fundamentally a sales and distribution organization reliant on outsourced manufacturing and, critically, on the IP and technical expertise now owned by a separate global entity (Innomotics/KPS). Siemens Limited stated it no longer possessed the in-house IP or capability to support the business independently. 

Sunil Mathur, Managing Director and CEO of Siemens Limited, framed the decision as a logical and responsible outcome: ***”We are pleased to have found the right home for the business with Innomotics, ensuring continuity for our customers and employees. Given Siemens Limited has limited synergies with the low voltage motors business, this decision is in the best interests of all stakeholders”**. 

This move continues a pattern of strategic focus for Siemens in India, following the recent demerger and spin-off of its energy business into a separate listed entity, Siemens Energy India Limited, which was completed in April 2025. 

Deal Structure and Financial Valuation 

The transaction is a sophisticated example of corporate restructuring, characterized by several key features: 

• Slump Sale Structure: The business is being transferred as a “going concern” via a slump sale. This means the entire undertaking, with all its assets and liabilities (excluding cash and debt), is sold for a lump-sum consideration without assigning individual values to each asset. 

• Valuation Benchmark: The ₹2,200 crore enterprise value was determined through negotiations and was benchmarked against two independent valuation reports from leading firms Grant Thornton Bharat LLP and KPMG Valuation Services LLP, as of September 30, 2025. 

• Financial Profile of the Divested Business: 

• For the 12 months ending September 30, 2025, the business recorded revenue from operations of ₹967 crore and an operating profit of ₹35 crore. 

• In the context of Siemens Limited’s overall performance (excluding the recently demerged energy business), this unit contributed about 6% to revenue and 2% to operating profit. 

• Notably, the business reported a negative net worth of ₹17.56 crore for FY2023-24. 

Financial Snapshot of the Divested Business (12 months ended Sept 30, 2025) 

Innomotics India: The Strategic Buyer’s Perspective 

For the buyer, Innomotics India Private Limited, this acquisition is a transformative milestone. As a wholly-owned subsidiary of the global Innomotics GmbH (now owned by KPS), the Indian arm specializes in electric motors and large drive systems. 

The acquisition allows Innomotics India to unify its portfolio with its global parent. Post-integration, the company will offer an end-to-end range from low-voltage and geared motors to high-voltage motors and large drives. This aligns its Indian offerings perfectly with Innomotics’ operations in 49 other countries. 

Satish Godbole, Executive Director of Innomotics India, emphasized the strategic fit: “Our business in India is now in perfect alignment with all other regions where Innomotics operates… this wider reach will significantly bolster the brand presence of Innomotics throughout India”. The company aims to leverage synergies to craft more comprehensive, customized solutions for industrial clients in high-demand sectors like metals, mining, water, chemicals, and oil & gas. 

Navigating the Legal and Regulatory Maze 

A transaction of this magnitude and nature requires meticulous legal navigation. Siemens was advised by the premier Indian law firm Khaitan & Co., which managed the entire transaction. 

The Khaitan team, led by Partner Niren Patel, provided end-to-end counsel covering transaction structuring, preparation and negotiation of the slump sale agreement, and all regulatory and listed-company compliance aspects. This core team was supported by specialized partners handling critical domains: 

• Employment Law: Ensuring the smooth transfer of the business’s 89 employees. 

• Competition Law: Assessing and securing the necessary clearance from the Competition Commission of India (CCI), a stated condition precedent for the deal’s closure. 

• Direct Tax & W&I Insurance: Advising on the tax implications of the slump sale and structuring warranties & indemnities insurance. 

This multi-disciplinary approach underscores the transaction’s complexity. Khaitan & Co. has a established relationship with Siemens, having recently advised Siemens AG on its €2.1 billion acquisition of an additional 18% stake in Siemens Limited from Siemens Energy in 2024. 

The Road Ahead: Timelines and Market Impact 

The transaction is expected to close by June 2026, contingent upon fulfilling customary conditions precedent, including receipt of statutory and regulatory approvals such as the CCI clearance. The process is anticipated to take 6-8 months from the execution of the agreement. 

From a market perspective, the deal has several implications: 

• For Siemens: It streamlines operations, removes a non-synergistic business dependent on external IP, and unlocks significant capital (₹2,200 crore) to potentially reinvest in its core domains of digital industries, smart infrastructure, and mobility. 

• For Innomotics: It creates a formidable, fully-integrated motor and drives champion in the Indian market, capable of competing more aggressively with a complete portfolio. 

• For Customers and Employees: The stated intent from both parties is to ensure continuity. Customers gain access to a more focused motor technology provider, while the 89 affected employees are expected to transition with the business. 

The announcement did impact Siemens’ stock price, with shares declining 3.6% on the day of the board approval. Market reactions often reflect short-term uncertainty, while the long-term strategic benefits of such a focused divestment will unfold over time. 

Conclusion: A Calculated Step in Corporate Evolution 

The ₹2,200 crore Siemens-Innomotics transaction is far more than a simple business sale. It is a case study in strategic corporate restructuring, driven by global ownership changes and the relentless pursuit of portfolio focus. For Siemens, it is about shedding a capable but IP-dependent unit to sharpen its focus on its technology-led core. For Innomotics, it is a decisive step toward building a dominant, integrated presence in the critical Indian market. 

As the deal progresses toward its expected mid-2026 closing, it will be watched closely as a bellwether for how multinational corporations navigate post-divestiture integrations and how specialized industrial technology firms consolidate to build scale and synergy in an evolving economic landscape.