GE will acquire Alstom’s Power and Grid business for AUD$ 17.87 billion, and
Speaking on the acquisition GE Chairman and CEO Jeff Immelt said “we will now move to the next phase of the Alstom alliance. We look forward to working with the Alstom team to make a globally competitive power and grid enterprise. We also look forward to working with the French government, employees and shareholders of Alstom. As we have said, this is good for France, GE and Alstom.
“For GE, the overall economics of the deal remain intact,” Immelt said.
“This transaction remains accretive in year one.”
The acquisition will be made through AUD$14.3 billion in enterprise value, and AUD$ 3.6 billion in cash.
Once the acquisition is finalised GE and Alstom will form three joint ventures which consist of Grid: which are the combined grid assets of GE and Alstom; Renewables: which are Alstom’s off-shore wind and hydro businesses; and Global Nuclear and French Steam: which will be built from Alstom’s production and servicing of equipment for nuclear power plants, and development and sales of new nuclear equipment around the world; and Alstom’s steam turbine equipment and servicing for applications in France.
In addition to this acquisition, GE will also sell its signalling business for AUD$ 871 million.
The two will also enter into “multiple collaboration agreements involving services, technology, supply chain, manufacturing, and commercial support in the U.S.,” GE added.