GE nears deal for Alstom
An employee of the French engineering group Alstom stands in front of the logo of the US company General Electric (GE) on April 29, 2014 in Belfort.
General Electric has won a bidding war for a French company called Alstom.
GE mostly wants the company’s turbine business. But other issues had to be taken into account.
“The country of France is really concerned with jobs. And also technology security,” says Daniel Holland, an equity analyst at Morningstar.
GE has agreed to a 50-50 partnership on the nuclear business. Plus other joint ventures. And it promises thousands of new jobs in France.
But that may not be enough. Government officials have asked GE to revise its bid.
“The French government is completely capable of screwing up this transaction,” says Cliff Ransom, an independent equity analyst with Ransom Research.
But French politicians could be more than gate-keepers. More like business partners. The government intends to buy 20 percent of Alstom.