Alstom may sell off energy business
Alstom is a French world leading energy solutions and transport company. The company is to sell off its energy business in order to strengthen its transport business.
General Electric has put in a bid for Alstoms energy business and the company is reviewing the offer. Although Alstom are also leaving the door open for a competing offer from Germany’s Siemens.
GEs offer for Alstom’s thermal power, renewable power and grid businesses is said to have totaled $16.9 billion, including enterprise value of $13.5 billion and $3.4 billion of net cash.
If Alstom do sell their energy part of the business they want to strengthen their transport part of the business for which they are also a global leader. One of the strengthening aspects is to include production of “TGV” high-speed trains.
Alstom said its board had also reviewed a declaration of interest from Siemens on an alternative deal and that the German company would have access to information needed to make a binding offer.
Siemens have said they are willing to make an offer provided it was given access to Alstom’s data room, as well as permission to interview the management during a four week period, to enable Siemens to carry out a suitable due diligence.
The leaders of both companies discussed their competing proposals on Monday but the government will place a priority on preserving jobs at one of the country’s key industrial firms.
Alstom has decided to set up a committee of independent directors to review the proposed transaction before the end of May, taking into consideration all stakeholders interests including the French state.
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