Siemens to invest $15 million in Arava Power

FRANKFURT (AP) — German industrial conglomerate Siemens AG said Friday it will buy a 40 percent stake in Israeli solar company Arava Power for $15 million (€10.5 million).

Kibbutz Ketura-Eilat-based Arava Power develops, builds and operates photovoltaic plants in Israel and is considered the Israeli market leader, Munich-based Siemens said in a statement.

Arava Power is a subsidiary of Global Sun Power Ltd., a partnership between the Kibbutz Ketura and American Investors.

The investment will contribute to Israel building the first commercial solar farms in the region between the Dead Sea and the Red Sea, Siemens said. Siemens will handle project management, including engineering and construction of the photovoltaic plants.

So far the two companies have a project framework agreement for a total output of 40 megawatts. The first project will be the construction of a plant with an output of about 5 MW at Kibbutz Ketura, in the south of the country, while additional photovoltaic plants are being planned for the Negev and Arava deserts.

"This investment is another consequential step in further strengthening our green and sustainable technologies," Peter Loescher, Siemens' chief executive, said in the statement.

"Thanks to its intensive sunshine and steadily growing demand for energy, Israel is an ideal location for further developing our solar business."

In a separate development Friday, Siemens said it was ready to come to a damages settlement with three former management board members stemming from a far-reaching corruption scandal that shook the company in 2006 and 2007.

In a statement, Siemens said Klaus Wucherer, Rudi Lamprecht and Edward Krubasik are prepared to pay the company €500,000 each in November, in an effort to avoid years of litigation and costs. Siemens said the agreement must be approved by the supervisory board and shareholders.

"The company has also been informed by the three former members of the managing board that the current legal proceedings against them instigated by the Munich public prosecutor for breaches of their supervisory duties in connection with the corruption issues have been terminated," Siemens' statement said.

Siemens said it's also holding settlement negotiations with other company officials related to the corruption scandal and that it expects agreements in the near future.

Siemens agreed in December to pay more than $1 billion in fines in Germany and the U.S., for among other charges, allegedly giving customers payments to secure business, especially internationally.

Shares of Siemens closed up 1.3 percent at €61.03 in Frankfurt.

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On the Net:

http://www.siemens.com

http://www.aravapower.com