Alstom to consider General Electric €13 billion offer

Siemens could still make a rival offer for Alstom, despite talks to acquire Rolls-Royce's energy business

French engineering company Alstom is considering a €13 billion binding offer from General Electric (GE) to acquire its energy activities, but has left the door open for a rival bid from Siemens.

Alstom this morning confirmed it has “received a binding offer from GE to acquire the Thermal power, Renewables and Grid businesses” that, if agreed, would see Alstom refocus on and strengthen its transport business.

Siemens has also confirmed it will make a competing offer if given access to Alstom's books.

However, the French government will play a key role in deciding which offer is to be accepted, and both bidders have already met with French president Francoise Hollande.

Alstom said its board recognised "unanimously the strategic and industrial merits" of the proposed transaction from GE. Patrick Kron, chairman and chief executive of Alstom added: "Alstom's employees would join a well-known, major global player, with the means to invest in people and technology to support worldwide energy customers over the long term. The proposed transaction would allow Alstom to develop its transport business as a standalone company, with a strong balance sheet to capitalise on opportunities in the dynamic rail transport market." 

The GE offer is to be reviewed by a committee of independent directors before the end of May. However, it appears Alstom is keeping its options open, confirming Siemens will have “fair access to information” needed to make a rival binding offer. Rolls Royce yesterday confirmed it is also in talks with Siemens regarding the sale of its energy gas turbine and compressor business.