Siemens has entered into a definitive agreement to acquire 100% of the share capital of Invensys Rail from Invensys plc. The transaction involves the full transfer of all rail-related assets to Siemens' Infrastructure & Cities sector, following the necessary regulatory and shareholder approvals. The acquisition is a strategic move to strengthen Siemens' Rail Automation business, establishing it as a core pillar of the Infrastructure & Cities sector. The combination is highly synergetic, merging two businesses with complementary geographic footprints and overlapping cultural focuses on engineering reliability. The rationale is centered on creating a global player in rail automation; the integration is expected to deliver substantial EBIT impact (>€100m p.a.) through a mix of procurement savings, portfolio streamlining, and enhanced customer coverage in both mass transit and freight segments.

INVENSYS RAIL, which reported an EBITDA margin of LOGIN in 2012, is valued in this transaction at an EV/EBITDA multiple of LOGIN, a level to compare with the average currently observed in the TMT (Tech, Media, Telecom) sector (13.8x).

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