Alstom To Review GE Offer Before May End

(RTTNews) - French speed-train maker Alstom SA (AOMFF.PK, ALS.L) Wednesday said it has received a binding offer from General Electric Co. (GE) to acquire its Energy activities. The company is considering the proposed acquisition and the creation of a strong standalone market leader in the rail industry, it added.

The Board of Directors of Alstom has decided to set up a committee of independent directors, led by Jean-Martin Folz, to review the proposed transaction before the end of May, taking into consideration all stakeholders interests including the French State.

The scope of the transaction includes the Thermal Power, Renewable Power and Grid Sectors, as well as corporate and shared services.

The proposed price is a fixed price representing an equity value of 12.35 billion euros and an enterprise value of 11.4 billion euros, Alstom noted.

If this offer is approved and completed, Alstom will refocus on its Transport activities and use the sale proceeds to strengthen its Transport business, pay down debt and return cash to its shareholders. The company will remain a listed company focused on Transport.

The Board of Directors of Alstom has decided to set up a committee of independent directors, led by Jean-Martin Folz, to review the proposed transaction before the end of May, taking into consideration all stakeholders interests including the French State.

Patrick Kron, Chairman and CEO of Alstom, and the committee will liaise with the representatives of the French State to consider their views.

In the context of this binding offer from GE, Alstom may not solicit offers from third parties for the acquisition of all or part of its Energy business.

However, it has reserved the right to respond to unsolicited offers for its entire Energy business and engage in discussions with bidders who could make a superior offer for Alstom.

If the Board of directors were to support another transaction after recommending GE's offer, Alstom would owe GE a break-up fee equal to 1.5 percent of the purchase price.

The Board also reviewed a declaration of interest from Siemens AG (SI), and said the German conglomerate would have a fair access to information needed to make a binding offer.

Alstom closed up 9.3 percent on Wednesday at 29.52 euros. GE settled higher by 0.5 percent at $26.89.