Boston, MA 06/02/2014 (wallstreetpr) – General Electric Company (NYSE:GE) has all long shown its growing interest in energy investment. In addition to pursuing organic growth, the company has made it clear that it is ready to enter deals of any size to boost its fortunes in energy. In the latest move, the company is training its eyes on the French company Alstom SA.
The executives of General Electric led by CEO Jeff Immelt were in France last week as part of their efforts to seek the backing of the country’s political leadership. GE executives met French President Francois Hollande. Source privy to the discussions revealed that GE executives assured President Hollande that the company will create more new jobs in France following the deal with Alstom.
According to General Electric Company (NYSE:GE) Vice Chairman, John Rice, following the talks last week, the French government is working on its view of the deal as GE discusses different aspects of the proposal.
GE promises flexibility
General Electric Company (NYSE:GE) offered $17 billion bid for Alstom’s energy business. However, the company is flexible enough to make more concessions if only such could help it get away with the deal that it considers important for its own energy segment.
The French political class seems concerned about foreign takeovers of domestic companies and the concerns mostly hinge on job positions and energy dependence. As such, the French political leaders seek to extract the best guarantee from bidders regarding the two issues.
In addition to General Electric, Siemens of Germany is also seeking to purchase Alstom’s energy business. Although Mr. Rice does not expect bid wars for Alstom’s energy unit, he said GE will seek to sweeten its deal not only to win the backing of the French political leaders, but also make the remaining Alstom business stronger.
Aiding Alstom against rivals
General Electric Company (NYSE:GE) is considering proposals for a partnership or sale of its signaling business. The company could cede the business to Alstom’s transport unit to help it compete more effectively with Ansaldo STS of Italy, Siemens and Canada’s Bombardier Inc.
The board of Alstom is expected to make a decision on General Electric Company (NYSE:GE)’s proposal on June 23.
