June 16 - German engineering group Siemens and Japan's Mitsubishi Heavy Industries present their joint move on France's Alstom. Joanna Partridge looks at whether it will be good enough to challenge a formal offer from General Electric.
It's best known for making high-speed TGV trains. But the race to acquire French firm Alstom's power equipment assets is hotting up - with several contenders on track. The latest - a joint bid from Germany's Siemens and Japanese group Mitsubishi Heavy Industries. It challenges an offer from U.S. giant General Electric which had sparked concern in the French government about keeping jobs and expertise in France. The German-Japanese plan would see Siemens get Alstom's gas turbines business, while Mitsubishi - keen to build a global presence - would inject cash and industrial assets into a joint venture in steam turbines. The deal would include a cash element of around 7 billion euros. GE CEO Jeffrey Immelt delivered his offer directly to the government in May. It's set the cut-off date of June 23 for its 12.4 billion euro bid for all of Alstom's energy arm, including its thermal and renewable power and grid businesses. Details of the Siemens-Mitsubishi plan came as France and Germany's economy ministers met in France SOUNDBITE: FRENCH ECONOMY MINISTER ARNAUD MONTEBOURG SAYING (French): "This is not a public discussion. Everyone knows the state of the case here in France. I will let the key players speak and we'll comment after that." Alstom is privately owned, but the French government has taken an active role in the talks. It views the group's transport and energy activities - especially the nuclear ones - as strategic, and also wants to keep jobs in France at a time unemployment is stuck above 10%. Paris has pushed for job guarantees and would like to see Alstom remain in the transport and energy sectors. It's called on Siemens to combine its rail activities with Alstom. The government's already secured a pledged from GE to create 1000 new jobs in France within three years of a deal. Darren Sinden from Titan Investment thinks that might not be enough. SOUNDBITE: Darren Sinden, Trader, Titan Investment, saying (English): "GE is archtypal of the U.S. company with a very fat chequebook and it can leverage its offer if it chooses to do so. This being France, I think the government there would definitely be pushing for the local deal, but even they must be pragmatic in the end and if GE wants to make a better offer and try and see Siemens off, then it may well do so." GE is expected to improve its offer. And Siemens and Mitsubishi bosses have another hurdle to leap too - they're to face questions from French lawmakers in parliament.