GE and Alstom to Synergistically Benefit from Acquisition

Addressing the press at Power Generation Week on Tuesday afternoon, Joe Mastrangelo, president and CEO of Gas Power Systems for GE Power, told reporters that GE and Alstom will benefit synergistically from the company’s recent acquisition.

Mastrangelo said technology portfolios from both GE and Alstom will cross-pollenate one another to improve the offerings of both companies. “For instance,” he said, “GE can bring combustion technology to Alstom’s turbine fleet, and Alstom can bring welded rotor technology to our intermediate-range gas turbines.”

GE has recently effected a portfolio shift, divesting itself of many financial services businesses and returning to a more industrial company. “In the past, GE was 40 percent industrial and 60 percent financial,” said Mastrangelo.  “Now it’s more like 80/20.”

GE has also been innovating products in faster iterative cycles. Mastrangelo said the company’s ability to employ digital engineering models to measure and test designs on the manufacturing floor can take years off the process of proving a bankable product. “We can demonstrate to customers that our products are run harder in testing than they will ever be in the real world. This makes reliability more of a known.”

By joining forces with Alstom, GE has also extended its footprint with respect to service shops and manpower. Alstom brings to GE a foothold in global ‘local domain’. “Now our customers won’t have to wait for someone to fly to them to solve a problem,” said Mastrangelo. “We’ll have experts located in our customers’ regions—places like Sub-Saharan Africa, China, India, and Eastern Europe.” As a result, GE and Alstom can complement one another synergistically and create a company that is larger than the sum of its parts.  

As part of the acquisition, GE acquired 30 more repair centers in 14 additional companies, for a total of about 50 repair shops in about 25 countries. GE also has repair development centers in six of these areas, in which they develop new repair technologies. “We’ll also be able to repair non-GE, non-Alstom technologies,” said Mastrangelo. “We’ll be able to work in all the world’s non-sanctioned countries, which will broaden our repair business significantly. We’ve already received a lot of interest from a lot of different companies.”