An offer from General Electric (NYSE: GE) to acquire French company Alstom has spurred a separate proposal from Germany’s Siemens, with Alstom stating that it would make a further announcement sometime this week.
Various reports last week stated GE was in talks to acquire Alstom for around $13 billion and an agreement could be announced as soon as this week. Siemens, however, announced Monday that it would consider making an offer for Alstom as well after meeting with French President François Hollande.
“A Siemens delegation will have the opportunity to meet with the French president and other high-ranking French political leaders today,” Siemens stated in the release. “Following this meeting, Siemens will convene as soon as possible to decide whether to make an offer for Alstom and what this will consist of.”
Monday’s announcement follows a Sunday statement from the Siemens that it had “submitted a letter to the Board of Alstom to signal its willingness to discuss future strategic opportunities.”
According to the Financial Times, Siemens proposed a nonbinding asset swap in a letter addressed to Alstom Chief Executive Patrick Kron. Under the proposal, Siemens would acquire Alstom’s thermal power, renewable power and grid divisions, and in return offered Alstom its high-speed train and locomotive units as well as a significant amount of cash for Alstom shareholders.
Siemens also promised not to cut jobs in France for at least three years or dispose of meaningful parts of the businesses acquired from Alstom, according to the Financial Times. French Economy Minister Arnaud Mounteborg stated the government would “not accept any hasty decisions” and would need time to “make a serious examination of the two proposals,” but noted a deal between Siemens and Alstom could create two “European champions” in transport and power engineering, the Financial Times reported.
A report from Bloomberg News, however, indicates the French government does not favor either bid. GE Chief Executive Officer Jeffrey Immelt met with Hollande Monday in a meeting that focused on protecting jobs and maintaining the independence of France’s nuclear industry, and the government does not oppose GE’s proposal, Bloomberg News reported.
Alstom stated in a release Sunday that it would make a further announcement before the end of the week.
“Alstom continues and deepens its strategic reflection and will make a further announcement no later than Wednesday 30 April morning,” the company stated. “In the meantime, the company has requested that the trading of its shares remains suspended.”
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