Earlier in November, Siemens said the legal separation of its healthcare unit in countries, including Germany, was a possible precursor to an eventual full or part disposal.

Chief Executive Joe Kaeser, who took over in a boardroom coup a year ago, is on a mission to simplify the once-sprawling conglomerate, weeding out or fixing underperforming businesses and allowing the stronger ones to shine.

The German engineering group agreed several conditions for the possible spin-off with its works council and IG Metall, the trade union said in an online newsletter.

In the agreement, healthcare redundancies have been ruled out and key operations, like the corporate headquarters will remain in Germany, IG Metall wrote.

In addition, Siemens agreed to maintain or expand its job base in healthcare in Germany, the union said in the newsletter, which was first reported by magazine Der Spiegel.

A spokesman for Siemens declined to comment.

Siemens has also agreed to sell its hearing-aid unit, Siemens Audiology Solutions, to private equity firm EQT and Germany's Struengmann family for 2.15 billion euros ($2.7 billion).

(Reporting by Thomas Atkins; editing by Keiron Henderson)