Alstom accepts GE bid for its energy unit

Sources say $13.8bn offer made; Siemens also expected to make bid

Alstom's energy unit has carried out dozens of power projects in the Middle East.
Alstom's energy unit has carried out dozens of power projects in the Middle East.

French energy and transport giant Alstom has reportedly accepted a bid for its energy unit from General Electric (GE), two sources familiar with the situation have told Reuters.

One source reported the bid to be in the region of $13.8bn (€10bn).

Both sources said Alstom’s talks with GE are not exclusive, with German conglomerate Siemens having revealed earlier in the week that it is also preparing an offer.

“Alstom’s board has accepted the GE offer; it will be examined by an independent committee,” one source close to the talks told Reuters.

“The two groups will not enter into exclusive negotiations. This means Alstom cannot go and look for other offers, but there is nothing to stop it from examining offers it receives without soliciting them,” the source added.

On Tuesday (29 April), Siemens said it would make an offer to Alstom if given four weeks to examine its books and draw up a detailed plan to rival a move by GE.

Siemens said it had sent a letter to Alstom in the afternoon after its managing and supervisory boards had decided to make an offer.

“The prerequisite for this offer is that Alstom agrees to give Siemens access to the company’s data room and permission to interview the management during a period of four weeks, to enable Siemens to carry out a suitable due diligence,” Siemens said.

It gave no further details of its plans, but at the weekend Siemens approached Alstom with a proposal to exchange part of its train business plus cash for Alstom’s power arm. In a short letter, it had outlined its proposal worth $14.5bn (€10.5bn).

Alstom has a significant presence in the Middle East, with its energy unit currently executing several power projects across the region.

As recently as 1 April, the company landed a $311m contract to build a power plant in Iraq's Anbar Province.
 

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