Hollande vows to protect jobs as he meets Alstom bidders
Paris (AFP) - French President Francois Hollande vowed on Monday to safeguard jobs in takeover target Alstom, whose energy business is being eyed by US giant General Electric and rival bidder Siemens.
Germany meanwhile sought to boost Siemens' case, saying a tie-up between the French and German giants offered a "big opportunity" for Europe's two biggest economies.
"The state will inevitably have a say" in the sale, Hollande declared, underscoring that the government placed several orders with Alstom "in strategic sectors especially energy."
He said the "sole criteria" in choosing the successful bidder would be which one "would be the best in creating more business and jobs."
The French leader first met GE chief Jeffrey Immelt for an hour and pressed his case for jobs and for Alstom's decision-making centre to be protected in France.
"There were legitimate issues (evoked by the government) which GE is working on," said a GE source.
Immelt himself described the talks as "open, friendly and productive".
"It was important to hear in person President Hollande's perspective and to discuss our plans," Immelt said. "We understand and value his perspective, and we are committed to work together."
- 'Patriotic' reaction -
Hollande then met with Siemens boss Joe Kaeser for about an hour. The German behemoth was expected to confirm its bid on Tuesday, a source close to the talks told AFP.
In Berlin, a spokesman for Germany's economy ministry said a possible tie-up between Alstom and Siemens would offer "a big opportunity and great potential in terms of industrial policy for Germany and France."
Under a preliminary proposal, seen by AFP but not confirmed by Siemens, the German group offered to buy Alstom's energy business and give the French giant part of its train activities in return.
The high-level talks are part of a race by the French Socialist government to protect Alstom's decision-making centre in France, jobs, and strategic energy interests, in what Economy Minister Arnaud Montebourg has described as a "patriotic" response to an expected bid by GE.
At the end of last week it emerged that GE was in advanced talks to buy Alstom's energy interests for about 10 billion euros ($14 billion).
Energy activities account for about 70 percent of Alstom's business, with the rest being focused mainly on making railway equipment including the TGV high-speed train.
GE already has big energy manufacturing activities in France, but Montebourg objected on Monday to the possibility that Alstom "in three days, can decide to sell 75 percent of a national jewel behind the backs of the employees, of the government, of most of the board and of the senior executives."
He told RTL radio that a bid from GE raised a simple problem that "the main part of Alstom, 75 percent of the businesses, 65,000 employees in the world, is going to be run from Connecticut."
Alstom is under pressure because its main markets for power generation and rail equipment are expected to be weak in the next few years.
Its share price has fallen heavily in the last year, causing losses at construction and telecom group Bouygues, which has a 29.4-percent stake in Alstom and whose CEO Hollande also met Monday.
Shares in Alstom have jumped on the bid reports, however.
Economists say Alstom is too small alongside giants such as GE and Siemens and that it is uncompetitive.
They also comment that the French government, since selling its stake in 2006, has little real control over what the Alstom board decides, and they tend to the view that a deal with GE would be a better strategic fit than one with Siemens.
The French government, in a recent policy switch and amid growing signs that national industry is seriously uncompetitive, is proposing big cuts in planned public spending to relieve taxes on businesses, but faces strong opposition from its left wing in a crucial vote this week.
The case of Alstom is highly sensitive politically and is also seen as emblematic of deep strains in many parts of French industry.
