Siemens Medical Solutions (Med) has announced its intention to divest its Life Support Systems business unit. The planned divestment is in response to objections on competition grounds, which the EU anti-trust authorities in Brussels have raised against Siemens’ proposed medical critical care joint venture with DrÃ¤gerwerk AG.
Life Support Systems comprises equipment used to sustain vital functions of patients such as anaesthesiology systems and breathing ventilators used in operation theatres and intensive care units.
In May 2002, Siemens and DrÃ¤ger announced an agreement to enter into a joint venture in the field of critical care to which DrÃ¤ger would contribute its entire medical division and Siemens its Electromedical Systems division.
According to Siemens, the joint venture will be able to respond better to market and customer requirements in the healthcare market. DrÃ¤ger and Siemens will respectively hold a 65% and 35% interest in the new joint venture.
‘Siemens believes a divestment of Life Support Systems is a necessary step in consummating our joint venture with DrÃ¤ger Medical, and the separation of the business should accelerate EU approval and therefore the start of our joint operations,’ said Dr. Erich R. Reinhardt, President and CEO of Siemens’ Medical Solutions. ‘We believe it is in the best interest of all our employees and customers to take this decision now, and to make every effort to find a suitable investor for the business unit as soon as possible.’
The decision to divest the unit has been taken in conjunction with an ongoing review of the proposed joint venture by anti-trust authorities in the European Union. While the US Federal Trade Commission has already approved the transaction with no conditions attached, the European Commission started an in-depth review of the proposed joint venture in late January.