France pushes for concessions as Alstom bidding enters crucial week

Sun Jun 15, 2014 5:19pm EDT
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By Gus Trompiz and Natalie Huet

PARIS (Reuters) - France is continuing to press for guarantees from contenders to buy power equipment assets from Alstom, as Siemens and Mitsubishi Heavy Industries consider a joint move to challenge a formal offer from General Electric.

The race to acquire power activities from Alstom, better known for its high-speed TGV trains, is entering a crucial week, with Siemens due to present an offer by Monday ahead of a June 23 cut-off date set by GE for its 12.4 billion euros ($16.88 billion) bid for all of Alstom's energy arm, which includes its thermal power, renewable power and grid businesses.

Alstom is privately owned but the government has taken an active role in the talks. It views the group's transport and energy activities, notably in nuclear power, as strategic and is keen to preserve jobs with unemployment stuck above 10 percent.

The French government has already secured a pledge from GE to create 1,000 new jobs in France within three years of a deal and Finance Minister Michel Sapin said on Sunday he expected the U.S. conglomerate to improve its offer further.

"Mitsubishi forming an alliance with Siemens improves Siemens' offer," Sapin said in an interview broadcast on Europe 1 radio and news channel iTele. "I think that GE is also going to improve its offer."

GE said in an emailed statement it had "made progress in our discussions with the French government, including expanded alliances in the energy businesses with French investors as well as a global partnership with Alstom on transport."

Siemens and Mitsubishi are putting the finishing touches on an offer for Alstom's turbine businesses, including a cash element of roughly 9 billion euros ($12.3 billion), according to sources close to the bidders.

Siemens' supervisory board was due to meet at 1600 GMT to consider an offer for Alstom. The German group has not commented on its discussions with Mitsubishi, but has said it would unveil a formal bid for Alstom assets by June 16.   Continued...

View of a Haliade 150 offshore wind turbine at Alstom's offshore wind site in Le Carnet, on the Loire Estuary, near Saint Nazaire, western France, April 27, 2014.   REUTERS/Stephane Mahe