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New Siemens Chief Plans Thousands of Job Cuts: FT

The new head of German conglomerate Siemens plans thousands of job cuts as well as a drive to link the pay of top management closer to performance, according to a newspaper report.

The Financial Times reported on Friday that Siemens new Chief Executive Peter Loescher wanted to make the changes to narrow the profitability gap with rival General Electric.

The paper said without citing sources that details of the plan are likely to be unveiled next week.

The trains-to-lightbulbs conglomerate is due to report full-year earnings on Thursday.

A Siemens spokesman declined to comment. "We do not comment on market speculation," he said.

Siemens shares fell 1.2 percent to 90.89 euros by 0951 GMT, while the German blue-chip DAX index slipped 1 percent.

Restructuring

Loescher, who took over as head of Siemens in May, is restructuring the company in the wake of investigations into suspected bribes that may amount to billions of euros, which prompted Siemens' previous CEO and chairman to resign this year.

From January, Loescher plans to regroup the company's 10 units into three divisions aligned with global growth trends: infrastructure and industry, energy, and medical technology.

The supervisory board is due to meet on Nov. 28 to approve the changes.

The plans include a reduction in the number of executives after former managers of various Siemens businesses including communications and turbines were suspected of authorising bribes disguised as payments to business consultants.

Siemens is being investigated by prosecutors in its home city of Munich and by the U.S. Securities and Exchange Commission. It has also hired outsiders to help it probe the allegations and to establish a new compliance culture.

Siemens has 475,000 staff worldwide. Of those, 161,000 are in Germany.