GE improves offer for Alstom

French government says US industrial giant has improved its offer for Alstom in latest twist

US industrial giant General Electric (GE) has improved its takeover offer for France’s Alstom energy division after it pledged to create French jobs, it emerged yesterday.

GE has offered commitments to create 1,000 new jobs in France over a three year period as part of its efforts to soften political resistance to a deal.

“Today we can see that GE’s offer has been detailed, improved, strengthened,” said an official at French President Francois Hollande’s office.

Job commitments are hugely important to the French government’s stance on a takeover of Alstom as France employs 18,000 out of 96,000 of Alstom’s global workforce. The company is also seen as a symbol of “French ingenuity”.

The move is a fresh twist in the takeover tussle for the French industrial player and came a day after Germany’s Siemens was said to be preparing a rival bid for Alstom.

Both potential suitors spent Tuesday in front of a committee of French politicians who grilled the two bidders behind closed doors on their commitments to French jobs and the future of the Alstom business.

Jeffrey Immelt, GE’s chief executive, told the National Assembly that his $17bn bid for Alstom’s energy assets would protect jobs and that France would have a greater influence on the global power industry if a deal went through and more sway in research and development spending.

Countering this, Siemens has argued that its potential deal would create a “European champion”.

The German player is also offering to swap its train assets in return for Alstom’s power arm. Siemens has said that it would take control of Alstom’s rail signalling business, but headquarter it in France.

However, GE is said to have improved its offer by including a tie-up in rail signalling which would give Alstom control of the business.

Alstom’s chief executive has previously broken ranks with the political message to say that he is less interested in Siemens’ offer on a train swap and would be more swayed by a rail signalling deal.

President Francois Hollande and economy industry minister Arnaud Montebourg have previously called on GE to improve its offer after deeming it “unacceptable”. Mr Hollande intervened and said that GE’s bid, which had been accepted by Alstom’s board, and invoke national security rules.

On 15 May Mr Montebourg introduced a new decree which allows the government to block foreign takeovers of French firms in “strategic” sectors. Any deal now needs approval by the French economy minister. Mr Montebourg said yesterday GE had “brought better proposals to the table”.