French Government Authorises GE-Alstom Deal
French government authorises GE-Alstom deal.Reuters

The French government has authorised the sale of most of Alstom's energy assets to US-based General Electric for €12.4bn, reports said.

France's Economy Minister Emmanuel Macron said on 5 November that Paris will activate the process that will see it purchase a stake of up to 20% in the troubled French engineering group, from shareholder Bouygues, once the GE-Alstom deal was fully completed.

The statement said: "Emmanuel Macron ... today gave his authorisation to General Electric (GE) for the realisation of its investment project in France with Alstom and the creation of an industrial alliance between the two groups in the energy sector."

The French government has amassed more than enough ready cash, from share sales, to fund its purchase of a 20% stake in Alstom, former economy minister Arnaud Montebourg said in June.

Montebourg told France's lower house during question time on 24 June: "Following the sale of [shares in] Airbus, Safran and Aeroports de Paris, we now have over €2bn ($2.5bn, £1.6bn) that will be used to take that stake in Alstom."

GE beat a combined offer by Germany's Siemens and Japan's Mitsubishi Heavy Industries.

National Interests

Earlier, German politician Peter Ramsauer slammed France's decision to choose GE over Siemens as the preferred buyer of Alstom's energy assets, saying France had put national interests over European interests in approving the deal.

Ramsauer also criticised France's plans to buy a stake in Alstom despite its heavy debts and budget deficit.

The French government agreed on 22 June to acquire a 20% stake in Alstom from construction group Bouygues. The move will help France strengthen its grip on Alstom, which employs thousands of people in the country.

Paris has the option to buy the 20% stake at a discount from Bouygues, which holds a 29.3% stake. Bouygues has said that the government's option to buy shares will last for 20 months and begin after the closing of the GE-Alstom deal.