Battle for Alstom heats up with Siemens offer

April 28, 2014 - 12:49:55 am
The logos of Alstom and General Electric are pictured at the site of the companies in Belfort.

PARIS: German industrial giant Siemens said yesterday it wanted to discuss strategic opportunities with France’s Alstom, raising the prospect of a takeover tussle with General Electric for the beleaguered firm. The offer came on the heels of reports that the US giant wants to buy the French engineering group, which manufactures the country’s groundbreaking high-speed TGV trains.

Alstom is a politically-sensitive symbol of engineering prowess in France and a key exporter, seen as one of the jewels of French industry. GE chief Jeff Immelt was expected in Paris yesterday but a meeting with France’s Economy Minister Arnaud Montebourg was deferred by Montebourg’s office, which said the minister needed more time to examine the offers following the Siemens announcement.

Montebourg’s office did not give a new date or time for the meeting with Immelt.

According to earlier press reports, the GE boss could also meet with Prime Minister Manuel Valls yesterday. But informed sources in the government said no such meeting had been pencilled in as yet.

Montebourg, a fierce protector of French industry, has pledged to study various options for Alstom following reports that GE would bid to buy the company’s power-generation division, accounting for more than 70 percent of its business with revenues of €14bn. 

He has said the government was exercising “patriotic concern and vigilance” while handling the case.

Although the French state has not held a stake in Alstom since 2006, France’s Socialist government wants to obtain guarantees on “jobs, the location of activities and energy independence”, according to President Francois Hollande’s office. 

GE has 305,000 employees around the world and its turnover totals $146bn.

Press reports have said GE was ready to fork out €10bn for the energy division, which does not comprise the unit that makes the high-speed trains.

But the stakes were raised yesterday when Germany’s Siemens said it had “submitted a letter to the board of Alstom to signal its willingness to discuss future strategic opportunities.”

The Siemens statement did not give any other details.

When Alstom was on the brink of collapse in 2003-2004, the French state strongly opposed a takeover by Siemens. AFP

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