A day before holding an annual conference to discuss its disappointing fiscal year, Siemens AG has announced that it will no longer consolidate the results of troubled semiconductor maker Infineon Technologies AG.
Siemens has sold enough Infineon shares to reduce its stake from 50.4 percent to under half, the company said in a statement Wednesday. It has also transferred 200 million Infineon shares to an irrevocable trust, the trustee of which is not allowed to exercise voting rights on the shares. But Siemens retains the power to sell the shares in the trust to third parties, and all proceeds from share sales and dividends flow back to Siemens.
The result is that independent Infineon shareholders now hold the majority of voting power, Siemens said.
Siemens reported last month a fiscal fourth-quarter loss of 1.1 billion euros (US$1 billion as of Sept. 30, the last day of the quarter), including Infineon losses.
Like other companies in the industry, Infineon is struggling with a losing economic equation: DRAM (Dynamic RAM) chips sell for less on the open market than they cost to produce.
Siemens' annual financial conference will take place Thursday at 10 a.m. Central European Time, and will be broadcast live via the company's Web site.