France's economy minister said Sunday that the government would not allow a hasty decision on the potential purchase of French engineering firm Alstom by either Germany's Siemens or US giant GE, saying the “national interest” was at stake.
Arnaud Montebourg, the country’s economy minister, urged the struggling French firm to consider a rival offer that emerged Sunday from German company Siemens, a deal he said would create “two European champions” in transport and engineering.
“Given the strategic stakes for French industry and economy, the government won't accept any decision made in haste and without taking account of alternative choices in the national interest,” he said in a statement.
"We are working to improve the offers to make sure that French companies ... do not become prey," Montebourg told France's RTL radio. "On the other hand, we are open to alliances that help to equip us for globalisation."
Montebourg said the competing purchase offers from the global giants would allow Alstom "to adopt different industrial strategies" for the future.
GE boss Jeff Immelt had been due in Paris earlier Sunday to hold talks with Montebourg on a possible $13 billion deal to buy Alstom's power turbines business, but a spokeswoman for the minister subsequently said Immelt's meeting had been postponed.
France’s outspoken economy minister said he would examine both GE and Siemen’s proposals “with the aim of preserving the interests of France’s industrial base” and added that the state was “ready to take part financially” in a deal.
Alstom announced that it has suspended trading in its shares as expectations grew for a possible bidding war between the US and German industrial heavyweights.
On Sunday evening, French President François Hollande gathered his top ministers, including Montebourg and Prime Minister Manuel Valls, to discuss the Alstom case.
Hollande met GE’s CEO Immelt Monday morning for talks that were "open, friendly and productive", the GE chief said in a statement following the meeting.
Montebourg and Hollande will meet with Siemens' CEO later in the day.
Separately, Alstom said it would make an announcement no later than Wednesday morning and that it had asked for its shares to remain suspended from trading until then.
“Alstom continues and deepens its strategic reflection,” it said in a three-line statement.
The future of Alstom has been the subject of intense speculation following a Bloomberg report Thursday which claimed that GE is in talks over a $13 billion deal for the turbine and train maker.
The prospect of one of France’s biggest engineering firms – one that employs 18,000 people in France and is a major government contractor – being sold to a US rival prompted the government to weigh in, with Montebourg telling French daily Le Monde on Friday that the potential deal was of “patriotic concern” to France.
The government wanted to look at alternatives to the GE deal, Montebourg said at the time.
A possible solution emerged on Sunday when Siemens announced it was prepared to discuss a possible tie-up with Alstom, which makes France’s prized TGV high-speed trains.
Siemens said it sent the Alstom board a letter “to signal its willingness to discuss future strategic opportunities” but declined to elaborate.
Detailed Siemens offer
According to French daily Le Figaro, however, Siemens is offering Alstom half of the German firm’s train-making division plus cash in exchange for the French firm’s turbines division.
The newspaper, which said it has seen the contents of the letter sent to the Alstom board, described the offer as informal but detailed and reported that it included a proposal for Alstom to take on Siemens’ high-speed trains and locomotives arm, but not its metropolitan trains division.
Le Figaro gave no details of the cash part of the deal.
In his statement on Sunday, Montebourg said the Siemens offer was aimed at creating “two champions of Europe and the world in the fields of energy and transport, one based around Siemens and the other around Alstom”.
The government “wants to have the time to make a serious examination of the proposals,” Montebourg added.
Shares in Alstom jumped more than 11 percent higher on Thursday following the takeover rumours, before trading was suspended by France’s stock market regulator on Friday.
(FRANCE 24 with AP, REUTERS)
Date created : 2014-04-27