Original news was published on 23 June, 2014
Alstom’s board has unanimously recommended its shareholders accept GE’s bid for the company, thereby rejecting a rival offer from Siemens and MHI. Alstom will retain its transportation division.
GE will purchase Alstom Power & Grid businesses for close to US$17 billion and subsequently establish three three joint ventures: nuclear, renewables and grid. GE will sell its signaling division to Alstom for about US$825 million.
The French government, which has been involved in negotiations, has confirmed it will grant the required foreign investment authorization, GE said in a statement.
Further, the government will purchase up to 20 percent of Alstom through a purchase of shares from Bouygues, a French engineering company. With its holding, the government will have voting rights and place two representatives on the new board.
Alstom’s nuclear assets were of particular concern to the government. Under the deal, newly-established Global Nuclear & French Steam Alliance will include the production and servicing of Alstom’s Arabelle steam turbine equipment for nuclear power plants, as well as Alstom’s steam turbine equipment and servicing for applications in France. The French government will control rights to Alstom’s nuclear technology.
Siemens and MHI submitted their offer last Monday and offered a revised version on Friday, but Alstom’s board said it did not “adequately address the interests” of the company or its shareholders.
The deal is expected to close in 2015, following the necessary approvals.