June 19 - U.S. giant General Electric has outlined an updated offer for the energy business of French engineering firm Alstom. But will it be enough to fend off a rival proposal by Siemens and Mitsubishi? Joanna Partridge reports.
Upping the stakes. Following advice from the French government, General Electric has improved its offer for Alstom. Its new bid for the French engineering group includes two 50:50 joint ventures in grid and renewables, and a global nuclear and steam alliance. GE said it hasn't changed its valuation of Alstom - and the deal would immediately boost the U.S. giant's earnings. Although Alstom shares slid by 5% on the news. GE is trying to see off a rival proposal from Germany's Siemens and Japan's Mitsubishi Heavy Industries. The two offers are very different - GE wants all of Alstom's power arm - 70% of its business. Whereas Siemens would just buy Alstom's gas turbines operation, with MHI taking minority stakes in power activities. France's Socialist government has given itself the power of veto - and protecting jobs is their priority. The competition's now one of Europe's fiercest industrial battles in recent years with both bidders are trying to curry political favour. Dominic Johnson from Somerset Capital Management says Paris shouldn't put politics first. SOUNDBITE: Dominic Johnson, CEO, Somerset Capital Management, saying (English): "If France is sensible, it should worry more about what the best outcome for business is, rather than what the best political outcome can be. And that's always the issue with most of these European countries, and in fact many of the developing markets I work in, political considerations seem to trump business priorities." The final countdown is on - with Alstom's board due to announce its choice next Monday. That's when GE's offer will also expire.