Siemens on Tuesday said it would spin off its power and gas business, separating the business which has dragged on the Germany engineering company`s performance due to collapsing demand for gas turbines amid the rise of renewable power.

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Siemens said the new business would create a "major player" on the energy market with business volume of 30 billion euros and over 80,000 employees.

The business, which includes the company`s oil and gas, conventional power generation, power transmission and related services businesses, is to be carved out with the aim of a subsequent public listing planned to take place by September 2020, Siemens said.

In addition, Siemens AG plans to contribute its majority stake in the market-leading renewable energies company SGRE – currently 59 percent – to Gas and Power.

Last week Reuters, citing sources familiar with the matter, reported that Siemens was considering carving out its Gas and Power unit.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)