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GE sweetens Alstom deal, will maintain France's presence in energy business

GE is in an international battle with Siemens and Mistubishi Heavy Industries to acquire the French company's energy and rail assets.

By Ananth Baliga
GE CEO Jeffrey Immelt said that the company set Alstom a June 23 deadline and that they would consider walking away from the deal after the deadline expires. UPI/Chip Somodevilla/POOL
GE CEO Jeffrey Immelt said that the company set Alstom a June 23 deadline and that they would consider walking away from the deal after the deadline expires. UPI/Chip Somodevilla/POOL | License Photo

PARIS, June 19 (UPI) -- GE said it will sweeten its deal to acquire Alstom by agreeing to two joint ventures, one in the power grid business and another in renewable energy.

The company said it will maintain its $13.5 billion to take over the French company but will set up two joint alliances that will ensure the French government still has some control over Alstom's energy assets. President Francois Hollande's government has expressed concern that it will lose control over the energy and transport business, as well as its nuclear energy needs.

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"The alliance will retain and strengthen France's presence in the energy business and reinforce Alstom Transport," GE CEO Jeffery Immelt said in a statement. "It creates jobs, establishes headquarters decision-making in France and ensures that the Alstom name will endure."

GE is also facing stiff competition from a joint bid from Siemens and Mitsubishi Heavy Industries, which would see the former take over the the French company's gas turbine business and Mitsubishi invest in a range of other Alstom units.

Immelt met with French Economy Minister Arnaud Montebourg and representatives of Alstom's unions to present the revised offer and convince them that GE's deal is the better option. GE's initial offer saw it absorb both business units into its fold but has changed the deal after French officials expressed concerns over job retention and losing control of important assets.

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GE set a June 23 deadline and on being asked if the American company was ready to walk away from the deal after the deadline Immelt said, "Yes, the deadline stands."

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