Siemens Acceleration in Communications is shutting down, and has put its 24-company portfolio on the block. Several bids have been submitted, with a final decision due this week.
The global group began life in 2001 as Siemens Mobile Acceleration, with a focus on seed and early stage opportunities in the wireless sector. It was renamed in March and given an expanded mandate to invest $100 million over five years in the broader communications space.
Since then, however, corporate parent Siemens AG has instituted a restructuring of its information and communications activities. It announced plans to lay off 5,400 employees, reportedly agreed to sell its Product-Related Services business to Fujitsu Siemens Computers and actually paid BenQ Corp. to acquire its money-hemorrhaging mobile handset unit.
The shutdown of Siemens Acceleration in Communications is just another part of the restructuring, with the corporate upside of near-immediate liquidity.
North American portfolio company CEOs were told of the sale earlier this month, and that it likely would close by the end of the year.
U.S. general manager Gerald Brady is expected to move to another position within Siemens, while U.S. vice president Sven Weber is expected to leave the company.
A number of bidders have expressed interest in the portfolio, including one that includes current Acceleration in Communications CEO Dietrich Ulmer and other Germany-based managers. A final decision was expected last week.
Siemens spokeswoman Paula Davis declined to confirm or deny the pending sale, saying that, “as a matter of policy, we don’t comment on rumor or speculation, which is what this is.”
Multiple sources both inside and outside of Siemens have confirmed the news, and added that the Acceleration in Communications portfolio was a particularly attractive divestiture because its seed-stage deals often had loose strategic ties to Siemens’ overall business. This is unlike the larger, later-stage Siemens Venture Capital program, which does not appear to be in jeopardy.
“Siemens Venture Capital is committed to contributing further to the Siemens global network of innovation’ in 2005/06, and will continue to invest in interesting opportunities and to nurture our existing portfolio,” says Sabine Zindera, vice president of marketing and communications for Siemens Venture Capital.
She adds that Siemens Venture Capital currently has more than 100 portfolio companies and $750 million in capital under management.