German engineering conglomerate Siemens has sold part of its loss-making IT services unit, SBS, to Fujitsu Siemens Computers for an undisclosed price.
Siemens said in a statement on Wednesday that the sale to the Siemens-Fujitsu joint venture would be effective April 1, adding that the SBS unit would now focus fully on IT services.
The Product Related Services part of the SBS unit that is being sold recorded sales of about 1.3 billion euros ($1.55 billion) in the fiscal year that ended September 2005, a quarter of SBS's total sales.
SBS as a whole made a loss of 690 million euros in the same period, mainly because of goodwill impairments and restructuring.
Sources had told Reuters earlier this month that Fujitsu Siemens was likely to take over the hardware maintenance division of Siemens' SBS unit.
"SBS will now focus completely on restructuring and developing its core business," Klaus Kleinfeld, Siemens chief executive, said in a statement.
Siemens had said earlier that it wanted SBS to concentrate on outsourcing and value-added services, which comprise the larger part of the business.
Siemens plans to cut more than 5,000 jobs out of SBS's 39,000-strong global workforce as it aims to slash costs at the unit by 1.5 billion euros by 2007.
Kleinfeld has pledged that all of the conglomerate's 11 units - which make products ranging from lightbulbs to turbines - will hit targets set for operating profit margins by April 2007.
In the last quarter six units made their targets.
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