Alstom has signed a deal with GE to exit the companies’ three energy joint ventures set up in November 2015 when GE acquired Alstom’s power and grid businesses.
Alstom says it intends to exercise its options to sell its interests in the renewables and grid joint ventures in 2018 (pursuant to Alstom’s put options). If these options are exercised during the exercise period (between Sept. 4 and Sept. 10), GE will then be deemed to have exercised its option to acquire Alstom’s interest in the nuclear joint venture (pursuant to GE’s call option), says Alstom.
GE reached an agreement with the France-based conglomerate in 2014 to purchase the power and grid businesses for EUR 12.35 billion ($13.61 billion), following a bidding war with both Siemens and Mitsubishi Heavy Industries. Adjusting for the joint ventures announced in June 2014 (renewables, grid and nuclear), changes in the deal structure, price adjustments for remedies, net cash at close and the effects of currency, the purchase price was EUR 9.7 billion (approximately $10.6 billion) when the deal closed in November 2015. GE then formed its GE Renewable Energy business, made up of an onshore and offshore unit, and Alstom said it would be “entirely refocused on [rail] transport.”
The transfer of all interests is expected to happen on Oct. 2 for EUR 2.594 billion (approximately $3.09 billion). A GE spokesperson has confirmed with NAW that there will not be any operational changes to any of the joint ventures.
