French president François Hollande met rival German and US bidders for Alstom, one of France's prime industrial assets, on Monday amid concerns that the company will fall into American hands.
At a hastily called meeting at the Elysée Palace, Hollande met representatives from Munich-based Siemens and General Electric in a bid to protect French jobs at the firm that makes the French rail network's TGV trains and the Pendolino fleet used by Virgin Trains, as well as owning a energy business.
The loss of Alstom to a US buyer would be a political and public blow to the country's beleaguered and unpopular Socialist administration, with the interest of Siemens viewed as a route to a more acceptable compromise.
Hours before Monday's meeting, several government ministers were summoned by Hollande to discuss the future of the company.
The French state sold its interest in Alstom in 2006 and has little power to intervene directly, but Hollande and his ministers have made it clear they prefer a European rather than American solution to Alstom's difficulties, and expect to be closely consulted about the firm's future.
The discussions centre on whether Siemens will relinquish its transport arm to Alstom in return for the French company handing over its energy division, with the aim of creating what one Siemens source told Le Monde would be "two European champions; one in energy, the other in transport".
The French government stepped in last week after it emerged that talks between Alstom and GE were already at an advanced stage.
The US company had offered around €10bn (£8.2bn) for Alstom's energy unit, which accounts for 70% of group revenues and whose products include coal-powered turbines.
Economy minister Arnaud Montebourg, who had warned of "patriotic" concerns over a GE deal last week, told France's RTL radio on Monday he would not accept that "in three days, Alstom can decide to sell... a national jewel behind the backs of the employees, the government, most of the board and senior executives".
Describing the situation as "unacceptable," he said: "French firms are not prey. However, we are prepared to make alliances enabling us to face global competition. "In the last few days we have taken several initiatives, the first being to reject a fait accompli."
Around three quarters of Alstom's portfolio is in the energy sector – the firm also makes steam turbines for nuclear power plants – and it employs 93,000 people around the world, including 18,000 in France.
Following the French government's obvious disquiet over GE's offer, Siemens wrote to Alstom's management at the weekend saying it was ready "to discuss future strategic opportunities".
Siemens had expressed an interest in its rival Alstom's energy holdings in 2004 when the French government ordered a bail out to save the company and it shed its shipbuilding interests, but the Germany company's advances were rebuffed.
Two years later the government sold its stake in the company. In spite of intense pressure from the government, Patrick Kron, Alstom's director general, is opposed to any partnership or take-over by the German company.
On Monday, following Siemens' counter offensive, Alstom announced dealing in its shares on the French stock exchange was suspended for two days of "strategic reflection". A decision is expected on Wednesday.
"Alstom is continuing and deepening its strategic reflection and will inform the market sometime before the morning of Wednesday 30 April. As a result, the company has asked that trading in its shares remains suspended, " it said in a statement.
After meeting Hollande, Jeff Immelt, head of GE, issued a statement saying: "The talks were open, friendly and productive ... it was important to hear in person President Hollande's point of view and to discuss our plans. We have agreed to work together."
Economist Nicolas Bouzou said the government's only weapon was verbal pressure and said he feared the French state's bullish approach to GE would have an opposite effect.
"The state's position is legitimate, given that the government wants to protect a company that is in the strategic sectors of transport and energy, but acting for the sake of public opinion is no good.
Some back-room diplomacy would be better," Bouzou told Le Parisien newspaper. Montebourg told Le Monde: "Alstom is a symbol of France's industrial power and our ingenuity. The government is concerned and urges patriotic vigilance."
theguardian.com
At a hastily called meeting at the Elysée Palace, Hollande met representatives from Munich-based Siemens and General Electric in a bid to protect French jobs at the firm that makes the French rail network's TGV trains and the Pendolino fleet used by Virgin Trains, as well as owning a energy business.
The loss of Alstom to a US buyer would be a political and public blow to the country's beleaguered and unpopular Socialist administration, with the interest of Siemens viewed as a route to a more acceptable compromise.
Hours before Monday's meeting, several government ministers were summoned by Hollande to discuss the future of the company.
The French state sold its interest in Alstom in 2006 and has little power to intervene directly, but Hollande and his ministers have made it clear they prefer a European rather than American solution to Alstom's difficulties, and expect to be closely consulted about the firm's future.
The discussions centre on whether Siemens will relinquish its transport arm to Alstom in return for the French company handing over its energy division, with the aim of creating what one Siemens source told Le Monde would be "two European champions; one in energy, the other in transport".
The French government stepped in last week after it emerged that talks between Alstom and GE were already at an advanced stage.
The US company had offered around €10bn (£8.2bn) for Alstom's energy unit, which accounts for 70% of group revenues and whose products include coal-powered turbines.
Economy minister Arnaud Montebourg, who had warned of "patriotic" concerns over a GE deal last week, told France's RTL radio on Monday he would not accept that "in three days, Alstom can decide to sell... a national jewel behind the backs of the employees, the government, most of the board and senior executives".
Describing the situation as "unacceptable," he said: "French firms are not prey. However, we are prepared to make alliances enabling us to face global competition. "In the last few days we have taken several initiatives, the first being to reject a fait accompli."
Around three quarters of Alstom's portfolio is in the energy sector – the firm also makes steam turbines for nuclear power plants – and it employs 93,000 people around the world, including 18,000 in France.
Following the French government's obvious disquiet over GE's offer, Siemens wrote to Alstom's management at the weekend saying it was ready "to discuss future strategic opportunities".
Siemens had expressed an interest in its rival Alstom's energy holdings in 2004 when the French government ordered a bail out to save the company and it shed its shipbuilding interests, but the Germany company's advances were rebuffed.
Two years later the government sold its stake in the company. In spite of intense pressure from the government, Patrick Kron, Alstom's director general, is opposed to any partnership or take-over by the German company.
On Monday, following Siemens' counter offensive, Alstom announced dealing in its shares on the French stock exchange was suspended for two days of "strategic reflection". A decision is expected on Wednesday.
"Alstom is continuing and deepening its strategic reflection and will inform the market sometime before the morning of Wednesday 30 April. As a result, the company has asked that trading in its shares remains suspended, " it said in a statement.
After meeting Hollande, Jeff Immelt, head of GE, issued a statement saying: "The talks were open, friendly and productive ... it was important to hear in person President Hollande's point of view and to discuss our plans. We have agreed to work together."
Economist Nicolas Bouzou said the government's only weapon was verbal pressure and said he feared the French state's bullish approach to GE would have an opposite effect.
"The state's position is legitimate, given that the government wants to protect a company that is in the strategic sectors of transport and energy, but acting for the sake of public opinion is no good.
Some back-room diplomacy would be better," Bouzou told Le Parisien newspaper. Montebourg told Le Monde: "Alstom is a symbol of France's industrial power and our ingenuity. The government is concerned and urges patriotic vigilance."
theguardian.com
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