France’s Socialist government has stepped into the fray about the future of engineering firm Alstom. Paris is worried about a possible takeover by General Electric and seeks talks with the US industrial giant.
Following reports on Thursday about merger talks between struggling French turbine and train maker Alstom and US engineering group General Electric (GE), France's Economics Minister Arnaud Montebourg expressed concern about the possible tie-up.
Speaking in an interview with French newspaper Le Monde on Friday, Montebourg said the Socialist government in Paris was expressing its patriotic concern and watchfulness with regard to Alstom.
“This concern is focused on the serious risk of losing a major decision centre,” he said.
Noting that he had met Alstom's Chief Executive on Thursday, Montebourg also said that Prime Minister Manuel Valls and he himself would meet the president of GE to discuss these concerns.
French engineering group Alstom builds power stations and high-speed trains. It is struggling as a result of sluggish demand in Europe for its turbines amid the eurozone debt crisis and falling electricity prices. The company, which also manufactures France's landmark TGV trains, is an important symbol for the country's engineering prowess.
On Thursday, several media outlets reported, however, that US industry group GE was interested in buying Alstom's energy activities. The US company reportedly had already received backing from French builder Bouygues, which is a main shareholder in Alstom. The deal is estimated to cost GE about $13 billion (9.4 billion euros).
As a result of the merger speculation, Alstom shares jumped 10.93 percent on the Paris Stock Exchange on Thursday. On Friday, trading in the stock, however, was suspended on the request of French financial market watchdog AMF. Alstom has denied it has received a public tender offer for its shares from GE.
uhe/lw (Reuters, AFP)