Alstom Backs GE’s Offer, But Siemens Looms In The Background

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France-based industrial giant Alstom says it will support GE's $16.9 billion binding offer to acquire its thermal, renewables and grid businesses.

According to GE, Alstom's board of directors has ‘positively received’ the all-cash offer and appointed a committee of independent directors led by Jean-Martin Folz to review the transaction.

If the offer is accepted on or before June 2, GE says that it will have an exclusivity period, and the next steps will include consultations with the government, Alstom shareholder approval and customary regulatory approvals. Notably, GE says that Bouygues S.A. – a 29% non-controlling shareholder of Alstom – supports its bid.


As part of GE's bid, Alstom says that it would not solicit offers from third parties for the acquisition of its energy business. However, Alstom notes that it reserves the right to respond to unsolicited offers, leaving the door open for rival industrial heavyweight Siemens.

Siemens' managing and supervisory board says that it too would move forward with an offer. While the statement did not provide specifics on the offer, Siemens did confirm that it sent an offer letter to France-based Alstom.

Siemens reports that its offer is contingent on Alstom providing access to company management over a four-week period and allowing Siemens access to Alstom's data room. Such a request, Siemens asserts, will enable it ‘to carry out a suitable due diligence.’

While a blockbuster, wind energy represents a minor part of the overall transaction, according to Dan Shreve, a partner at MAKE Consulting. Still, the wind business of either suitor could benefit.

‘GE and Siemens stand to benefit with respect to acquiring Alstom's wind business,’ Shreve notes. ‘But the synergies with GE's wind business are more favorable.’

He adds that GE would get another chance to engage in the European offshore wind market with Alstom's 6 MW permanent-magnet direct-drive product, which Shreve says, ‘can compete head to head with Siemens 6 MW turbine and Vestas' 8 MW offering.’

From the Siemens perspective, Shreve notes the acquisition's impact on the Siemens' European offshore plans is the most significant. However, Siemens would need to define a localization and supply strategy for France and the UK.

‘It should also be noted that elimination of Alstom as a competitor limits the number of viable turbine suppliers in the EU offshore market.’

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