France rejects GE bid for Alstom ‘in current form’

The French government on Monday rejected a bid by US industrial giant General Electric for Alstom's energy business, calling for a "balanced partnership" that could include a rail deal.

France rejects GE bid for Alstom 'in current form'
General Electric bid €12.4 billion ($17 billion) for Alstom's energy arm. Photo: Sebastien Bozon/AFP

"In its current form, we can unfortunately not agree to the propositions you have made, resting only on the acquisition of Alstom's activities in the energy sector," Economy Minister Arnaud Montebourg said in a letter to GE chief Jeff Immelt.

The US behemoth has been vying for Alstom's energy assets with German giant Siemens in a politically sensitive bidding war over the French engineering group.

Montebourg was charged by French President François Hollande with responding to GE's €12.4 billion ($17 billion) bid for the energy assets of the company, which employs 18,000 staff in the country.

The firebrand minister has vowed to "defend the industrial interests of the nation" in the deal.

In the letter seen by AFP, Montebourg told Immelt the French government "wishes to examine the ways and means of a balanced partnership, rejecting a pure and simple acquisition that would lead to the demise of Alstom."

He said the French government was concerned about "the separation and isolation of the branch of Alstom specialized in rail transport" if GE only buys the energy arm.

Energy activities — which include power generation and transmission — account for about 70 percent of Alstom's business but the company is better known as a railway equipment maker that manufactures France's prized TGV high-speed trains.

Montebourg suggested that General Electric in turn hand over its activities in the rail sector to Alstom.

"It would be highly desirable to insure a global future for Alstom Transport, by ceding General Electric's transport activities to this entity, including freight trains and signals, representing revenues of $3.9 billion," the minister said.

Reacting to Montebourg's letter, General Electric defended its bid for Alstom's energy assets.

"We appreciate the engagement of the French government. We believe our proposal is good for France, for Alstom and for GE. As our letter to President Hollande stressed, we are open to continuing dialogue," said the company.

Shares in GE, a Dow component, closed at $26.58, down 0.4 percent.

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France increases to €9,000 grants for property owners

A French scheme to provide financial aid to property owners seeking to replace oil and gas boilers with eco-friendly alternatives has been extended, with grants of up to €9,000 now available.

France increases to €9,000 grants for property owners

The French government will increase the amount of money available to replace gas and oil-powered boilers through the MaPrimeRenov’ scheme, part of a package of measures announced by Prime Minister Jean Castex on Wednesday

Environment Minister Barbara Pompili said that from April 15th, some households would be able to benefit from an extra €1,000 to “accelerate the replacement of fossil fuel-powered boilers with renewable heating solutions”, such as heat pumps and biomass heaters. 

It will no longer be possible to use state funding to replace a gas boiler with another, more efficient gas boiler. 

This brings the total state aid available for replacing boilers up to €9,000. 

Who can benefit? 

The funding for boiler replacement is available through the MaPrimeRenov’ scheme – which is available to anyone who owns property in France. 

Applicants for funding do however need a French numéro fiscal (tax number) and a copy of their latest tax declaration, which means those who do not file the annual tax declaration in France are effectively excluded. 

You can only apply for funding if your property is more than two years old. 

The amount of money you could receive depends on a range of criteria including: household income; the number of people living in the household; and the location of the property. 

You can read more about the MaPrimeRenov’ scheme HERE

Why is the government doing this? 

The move essentially allows France to faire d’une pierre deux coups – hit two birds with one stone.

One one hand, it will allow the country to cut down on greenhouse gas emissions in the face of the global climate crisis. 

On the other, it allows France to reduce its dependency on Russian gas – which has become a government priority ever since the invasion of Ukraine.

French Prime Minister Jean Castex said the government would target and end to dependency on Russian energy by 2027. The construction of new nuclear plants announced in February will also assist in reaching this objective.

You can read more about the government’s measures to insulate the French economy from the war in Ukraine HERE