Following from US industry giant General Electric’s bid to acquire French company Alstom, the French government has fashioned an alternative proposition: a “double merger” between the energy and transport business of Alstom and its European arch-rival, the German engineering company Siemens. The result would be two new businesses, presented as Franco-German champions.
Industry minister, Arnaud Montebourg, cancelled a meeting with GE boss, Jeff Immelt, at short notice, in order to study a counter bid made by Siemens. Siemens is proposing an asset swap with Alstom, rather than a full-scale takeover.
It would seem that France is in an uproar over the potential loss of a national champion, whose turbines are used in power stations and whose carriages are made for tube trains. Monteburg also warned that the government would not accept a swift sale of Alstom’s power business and refused to rule out nationalisation.
According to a letter leaked on the website of the French newspaper, Le Figaro, Siemens made a rushed bid for the Alstom energy business. As part of the deal, it offered to cede half of its own train-building operations to the French company. This deal, apparently secretly negotiated by the French government, runs against the wishes of Alstom shareholders and their top managers, arguing that it would destroy far more jobs in France than a sale to a would-be investor and saviour like GE.
The minister said that France would of course block any deal it considered contrary to its long-term interests: “We are working to improve the offers to make sure that French companies…do not become prey,” he said. “On the other hand, we are open to alliances that help to equip us for globalisation.”
