General Electric CEO Jeff Immelt meets Alstom workers in a gas turbine manufacturing centre in Belfort, France

GE boss visits Alstom centre to celebrate takeover

The CEOs of GE and Alstom have visited Belfort, a town in eastern France and a main turbine manufacturing centre of Alstom, to celebrate the $16.9bn takeover agreement reached over the weekend.

After months of negotiations with the French government, the US engineering giant GE has managed to secure its biggest acquisition ever, which will see 65,000 Alstom’s workers, out of 96,000 globally, as well as the company's assets, being transferred to GE.

The deal is expected to be finalised by the first half of 2015. Apart from a complete takeover of Alstom’s global gas turbine business, GE will enter into multiple joint ventures with Alstom in other areas.

During the trip to Belfort, GE’s head Jeff Immelt and Alstom’s CEO Patrick Kron spoke to local workers, reassuring them that the acquisition will secure their jobs in the long term.

"I think it's a three-fold win," Kron told reporters during the visit.

"It provides a future for the activities and employees of Alstom, it has an industrial logic that GE and ourselves called for, and it addresses the government's concerns regarding (France's) energy transition and nuclear sovereignty."

Power turbine production in the Belfort centre has a 15 year long tradition. The factories have been building power turbines for about 30 per cent of the world's nuclear plants, including those sold by French utility EDF.

From the start of the negotiations, French government was concerned about the business falling into foreign hands and blocked the first GE offer to buy outright all of Alstom's power business.

After weeks of negotiations, an agreement was reached on Sunday, guaranteeing the French government an option to buy 20 per cent of Alstom from its current top shareholder Bouygues.

Yesterday it was revealed the government has agreed to sell a 3.1 percent stake in gas utility GDF Suez in order to secure finances to buy its stake of Alstom.

The sale will leave the French state - lead shareholder in GDF Suez with 36.71 per cent stake - with a residual stake of around 33.6 per cent according to a source close to the deal. By law, The French State cannot reduce its stake below 33.3 per cent. Publicly owned bank CDC owns another 1.9 per cent.

Economy Minister Arnaud Montebourg said earlier on Tuesday the state had enough cash available from previous share sales to fund the purchase of the Alstom stake.

Montebourg said that following the sale of shares in Airbus, Safran and Aeroports de Paris, the state now has over €2bn (£1.6bn) that will be used to buy the Alstom stake.

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