Alstom’s Kron Misled Government on GE Plan, Montebourg SaysGregory Viscusi and Helene Fouquet
Alstom SA Chief Executive Officer Patrick Kron misled the government by insisting he wasn’t seeking to sell any part of the French engineering company, Economy Minister Arnaud Montebourg said.
“Does the Economy Minister have to install lie detectors in his office because the CEO of a CAC 40 company isn’t public spirited enough to alert the government,” Montebourg asked during a debate in parliament today.
The French government learned from a Bloomberg News report that Alstom was in talks with General Electric Co. with regard to a potential bid, Montebourg said in a statement on April 27. Over the weekend, Germany’s Siemens AG said it would make an offer of its own, which the minister said was being delivered today to Alstom.
“This government doesn’t accept -- and what government would -- the ‘fait accompli’ of being told Friday night that one of its industrial jewels is going to be sold on Sunday,” Montebourg said in parliament. “I’ve been asking since February and each time Patrick Kron, the chairman of this jewel, solemnly assured me that he didn’t have any projects for alliances.”
GE CEO Jeffrey Immelt as well as Siemens CEO Joe Kaeser and Chairman Gerhard Cromme, yesterday met with French President Francois Hollande. He told them that the state, which doesn’t have a direct stake in Alstom, would insist on the preservation of jobs, keeping decision making in France, and the protection of the country’s energy independence.
Montebourg said that Alstom, which sells turbines to the nuclear plants run by electrical utility Electricite de France SA, “lives off of public contracts.”
Alstom, saved from bankruptcy about a decade ago by the state, employs 18,000 people in France and has a market value of about 8.3 billion euros ($11.5 billion).
Montebourg defended the state’s intervention in the case, saying that, given its strategic nature, such action is necessary. He said France is open to foreign investors, adding that GE has acted “totally correctly in this affair.”