Siemens said in a statement its supervisory and managing boards would ask shareholders at the annual meeting on January 23 to approve a "spinoff of 80.5 percent of Osram activities followed by Osram's public listing."

Under the terms of the transaction, Siemens shareholders would receive one Osram share for every 10 Siemens shares held, the statement said.

Siemens said it would remain a shareholder in Osram.

"Following the spinoff, Siemens AG will, accordingly, hold a 17-percent stake in Osram, and the Siemens Pension Trust will hold a 2.5-percent stake," it said.

Implementation of the spinoff plans would require the approval of at least 75 percent of shareholders at the annual meeting.

Siemens had originally planned to list Osram late last year in what would have been the biggest German initial public offering (IPO) in years, but subsequently postponed it due to market volatility.

Earlier this year, finance chief Joe Kaesner flagged "late summer or early autumn" as a possible timeframe for the sale and in an interview with Dow Jones Newswires on Thursday, he said Siemens was eyeing a flotation in September or October.

Based like Siemens in Munich, southern Germany, Osram makes traditional bulbs and high-tech products like LEDs (light-emitting diodes) and OLEDs (organic light-emitting diodes).

Although it is very profitable, Osram -- which employs 40,000 people worldwide -- needs major investments to complete the transformation of its operations to LED technology.