Munich, Germany – Siemens has for the time being suspended three employees who allegedly participated in collusion regarding power transformers produced by Siemens’ Power Transmission and Distribution Group (PTD) and VA Tech EBG Transformatoren GmbH & Co. According to Siemens’ internal findings, five companies were involved in this collusion, which took place in the German market between 2001 and 2003. ”We want any improprieties to be clarified quickly and expediently, and we are taking appropriate action,“ said Udo Niehage, President of PTD.

The starting point of Siemens’ internal inquiry was an investigation conducted last week by the EU Commission at PTD locations in Nuremberg, Germany and Linz, Austria. The facility in Linz belongs to VA Tech EBG, which Siemens acquired in July 2005 with its takeover of VA Tech. The EU Commission is investigating collusion in the area of power transformers in Germany, Austria and the Netherlands between 1999 and 2003.

According to initial internal findings, employees of PTD and VA Tech participated in collusion between 2001 and 2003. “Isolated incidents of this nature cast a bad light on the strong achievements of all other employees. This cannot be tolerated,” said Niehage. Initial internal investigations also revealed that this collusion, which involved five companies, took place in the German market.

Siemens is interested in the rapid and complete clarification of this matter and has promised the EU Commission its full support and cooperation. The company has already provided the EU Commission with extensive findings from its internal investigations. Further details in the matter are not yet available.

Siemens AG (Berlin and Munich) is a global powerhouse in electrical engineering and electronics. The company has around 475,000 employees (incl. discontinued operations) working to develop and manufacture products, design and install complex systems and projects, and tailor a wide range of services for individual requirements. Siemens provides innovative technologies and comprehensive know-how to benefit customers in over 190 countries. Founded more than 155 years ago, the company focuses on the areas of Information and Communications, Automation and Control, Power, Transportation, Medical, and Lighting. In fiscal 2006 (ended September 30), Siemens had sales of €87.3 billion and net income of €3.033 billion, according to U.S. GAAP. Further information is available on the Internet at: www.siemens.com