Competition for the acquisition of Alstom (Levallois-Perret, France) is nearing a climax, with Siemens (Munich, Bavaria, Germany) and Mitsubishi Heavy Industries (MHI, Tokyo, Japan) unveiling their bid to counter General Electric (GE, Fairfield, Conn., USA).
According to renews.biz and Reuters, in response to GE’s deadline of June 23 for its €12.4 billion ($16.88 billion) bid for Alstom's thermal power, renewable power and grid businesses, Siemens has offered € 3.9 billion in cash for all of Alstom’s gas turbine business, but will leave the French company in control of its wind and grid units. The German firm said it will establish its European headquarters in France for the newly combined gas businesses and has offered a job guarantee for three years in both Germany and France for the transferred unit.
Meanwhile, MHI will inject € 3.1 billion into three joint ventures with Alstom, acquiring 40 percent of its steam turbine and nuclear energy businesses, 20 percent of its grid business and 20 percent of its hydro unit, while creating 1,000 jobs in France.
The German-Japanese alliance say their proposals would strengthen the Alstom brand as a sustainable player in both energy and transport. Siemens president Joe Kaeser is quoted as saying this arrangement would be a win-win for all involved, with energy businesses strengthened and potential to unite with Siemens to form a European rail champion.
Alstom is privately owned but the French government has taken an active role in the acquisition talks, viewing the the company's transport and nuclear energy activities in particular, as strategic. With unemployment still over 10 percent, France is also keen to preserve jobs.
GE had already pledged to create 1,000 new jobs in France within three years of its deal.
The question now is whether GE will up its ante, as expected by the French government prior to the Siemens and MHI bid.