Siemens and Mitsubishi Heavy Industries have launched a joint bid to take over Alstom's energy business, in reaction to a bid by General Electric that is already under discussion.
While GE originally bid for Alstom's entire energy and grid businesses, the alternative presented by Siemens and MHI is far more complex. It would see Siemens take Alstom's gas business, while Alstom and MHI would set up joint venture businesses in steam, hydro and grid. Alstom would remain the majority holder of the joint ventures, while MHI invest a total of about €3.1 billion ($4.2 billion) in them and buy a 10% stake in the Alstom group.
The offer by Siemens and MHI was said by them to value Alstom's power businesses at €14.2 billion ($19.2 billion), compared to GE's bid which valued power and grid together at $13.5 billion. Aside from these, Alstom also has a significant transport business, in which Siemens said it would be prepared to become a long-term partner.
Alstom's board has already announced its unanimous support for GE's offer. However, the French government has the power to block takeovers of companies deemed to be in strategic sectors and was not so enthusiastic. Industry minister Arnaud Montebourg asked GE to work towards a partnership deal rather than an outright acquisition. Accordingly, GE agreed to the government's request to extend the deadline for the Alstom board's consideration of its proposal to 23 June to accommodate ongoing discussions with the government. Under the terms of GE's offer, Alstom may not solicit other offers for its energy business in the meantime, but it may respond to any unsolicited offers it receives.
Siemens and MHI's presentation of its counter-proposal emphasised that Alstom would remain listed in France and highlighted French jobs. Siemens CEO Joe Kaeser said the proposal represented a "win-win solution" for all involved. Meanwhile, MHI CEO Shunichi Miyanaga pointed to his company's track record of working with Areva in the nuclear sector. "I believe our collaboration with Alstom in the turbine business will give birth to another Japan-France alliance with superior technological expertise, which will be able to address the needs of emerging nations," he said.
Researched and written
by World Nuclear News