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Siemens strengthens its position in the subsea power market


Acquisition of subsea specialists Poseidon and Bennex

Erlangen, Germany, Siemens has entered into an agreement to acquire the two subsea specialists Poseidon Group AS and Bennex Group AS from Subsea Technology Group AS, Norway. Poseidon provides subsea marinization, engineering and consulting, and has a workforce of 140 employees and consultants in Stavanger and Aberdeen. Bennex has about 160 employees in Norway (Bergen and Kongsberg), Scotland (Aberdeen) and the US and develops and manufactures subsea equipment mainly for power solutions. The combined revenue of the two companies is approximately EUR75 million. The purchase price is not disclosed. The transaction is subject to the approval of the responsible antitrust authorities.
subsea processing facilities Siemens Subsea Power Grid

Subsea Technology Group (STG) backed by the oil and gas specialist private equity investor HitecVision, has over the past three years built a diversified engineering, products and services company within subsea, drilling & well, reservoir and process disciplines. “HitecVision’s core business is to buy, develop and sell quality companies to the right buyer,” says HitecVision Senior Partner and STG board member Pål M. Reed and adds: “The strong strategic match between Siemens and Poseidon and Bennex will enable quicker realization of the companies’ development plans and the transaction should be very positive for employees, customer and owners.”

“Subsea processing is a fast growing and technologically challenging part of upstream Oil & Gas,” said Tom Blades, CEO of Siemens Oil & Gas Division. “In May 2010, we announced the development of a subsea electrical grid to power seabed processing and production systems including pumps and compressors. With the acquisition of Poseidon and Bennex, Siemens has taken a major step to strengthen its in-house capabilities in marinization, subsea engineering and consulting and assert itself as the leading developer of subsea power grid solutions on the back of its traditional electrical engineering core-competence.” Siemens anticipates that the subsea power grid market will enjoy a double digit growth especially in power grid applications, to become a multi billion market in 2020.

The dilemma of demand growth exacerbated by mature field depletion is forcing oil and gas companies to exploit offshore fields farther out to sea at ever greater water depths. Full-scale subsea processing is a vital component in enabling the commercial viability of these fields that will be brought on stream in the coming years around the globe in places such the Americas and West Africa. One of the main objectives of deep water seabed processing is to counter the enormous hydrostatic pressure, while closing the recovery gap compared to a traditional land based well. Siemens’ subsea power grid can be deployed in water depths of as much as 3,000 meters and is an enabler in closing this gap, opening the way for a more reliable and safer offshore production environment. “The acquisition will add to Siemens’ capabilities, experience and credibility in subsea engineering, equipment marinization, connection and penetration technology, which are the main elements required to integrate our subsea power grid solution,” added Blades

Bennex is one of the leading suppliers of subsea distribution (hydraulic and electrical) systems, fiber optic, electromagnetic and seismic applications. Poseidon is a subsea engineering and consulting company capable of marinizing existing Siemens equipment and technology to subsea environment, such as subsea control systems, transformers, switchgears, electric motors automation and compressors along with other complementary elements such like cameras and subsea electric valve actuators.

Siemens subsea solution includes transformers, switchgear and variable-speed drives along with other elements, to power and control electric-driven pumps, compressors, and other processing equipment. Siemens is already active in marinization of equipment such as the STC-ECO compressor that completed a comprehensive factory test program in August 2010. This compressor is a central feature of subsea processing. Siemens has accumulated extensive experience in subsea applications such as Siemens Subsea Controller (SSC) operating for Statoil´s Snorre project and the transformers in operation in Petrobras´ Carapeba oil field off the Brazilian coast.

The Siemens Energy Sector is the world’s leading supplier of a complete spectrum of products, services and solutions for the generation, transmission and distribution of power and for the extraction, conversion and transport of oil and gas. In fiscal 2010 (ended September 30), the Energy Sector had revenues of approximately EUR25.5 billion and received new orders totaling more than EUR30.1 billion and posted a profit of more than EUR3.3 billion. On September 30, 2010, the Energy Sector had a work force of more than 88,000. Further information is available at:

Subsea Technology Group is a diversified engineering and manufacturing company with focus within subsea, drilling & well, reservoir and process disciplines. The group includes the companies Bennex, Poseidon, Ross Offshore, Altra Energy and Well Processing and has key locations in Norway, Scotland and the US.
Further information is available at:

This document contains forward-looking statements and information – that is, statements related to future, not past, events. These statements may be identified by words such as “expects,” “looks forward to,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “will,” “project” or words of similar meaning. Such statements are based on the current expectations and certain assumptions of Siemens’ management, and are, therefore, subject to certain risks and uncertainties. A variety of factors, many of which are beyond Siemens’ control, affect Siemens’ operations, performance, business strategy and results and could cause the actual results, performance or achievements of Siemens to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements. In particular, Siemens is strongly affected by changes in general economic and business conditions as these directly impact its processes, customers and suppliers. This may negatively impact our revenue development and the realization of greater capacity utilization as a result of growth. Yet due to their diversity, not all of Siemens’ businesses are equally affected by changes in economic conditions; considerable differences exist in the timing and magnitude of the effects of such changes. This effect is amplified by the fact that, as a global company, Siemens is active in countries with economies that vary widely in terms of growth rate. Uncertainties arise from, among other things, the risk of customers delaying the conversion of recognized orders into revenue or cancellations of recognized orders, of prices declining as a result of continued adverse market conditions by more than is currently anticipated by Siemens’ management or of functional costs increasing in anticipation of growth that is not realized as expected. Other factors that may cause Siemens’ results to deviate from expectations include developments in the financial markets, including fluctuations in interest and exchange rates (in particular in relation to the U.S. dollar), in commodity and equity prices, in debt prices (credit spreads) and in the value of financial assets generally. Any changes in interest rates or other assumptions used in calculating pension obligations may impact Siemens’ defined benefit obligations and the anticipated performance of pension plan assets resulting in unexpected changes in the funded status of Siemens’ pension and post-employment benefit plans. Any increase in market volatility, further deterioration in the capital markets, decline in the conditions for the credit business, continued uncertainty related to the subprime, financial market and liquidity crises, or fluctuations in the future financial performance of the major industries served by Siemens may have unexpected effects on Siemens’ results. Furthermore, Siemens faces risks and uncertainties in connection with certain strategic reorientation measures; the performance of its equity interests and strategic alliances; the challenge of integrating major acquisitions and implementing joint ventures and other significant portfolio measures; the introduction of competing products or technologies by other companies; changing competitive dynamics (particularly in developing markets); the risk that new products or services will not be accepted by customers targeted by Siemens; changes in business strategy; the outcome of pending investigations, legal proceedings and actions resulting from the findings of, or related to the subject matter of, such investigations; the potential impact of such investigations and proceedings on Siemens’ business, including its relationships with governments and other customers; the potential impact of such matters on Siemens’ financial statements, and various other factors. More detailed information about certain of the risk factors affecting Siemens is contained throughout this report and in Siemens’ other filings with the SEC, which are available on the Siemens website,, and on the SEC’s website, Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the relevant forward-looking statement as expected, anticipated, intended, planned, believed, sought, estimated or projected. Siemens neither intends to, nor assumes any obligation to, update or revise these forward-looking statements in light of developments which differ from those anticipated.

Reference Number: EOG201103049e


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