French industrial group Alstom swung into the red in the first half of the year, partly due to the ceding of power business assets to General Electric. Adjusting for the joint ventures announced in June 2014 (renewables, grid and nuclear), changes in the deal structure, price adjustments for remedies, net cash at close, and the effects of currency, the purchase price is approximately $10.6 billion.
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The firm owned 44.8% by Italian state-owned holding company Fondo Strategico Italiano and 40% by Chinese equipment manufacturer Shanghai Electric on November 3 signed a binding agreement with General Electric to acquire select Alstom assets.
The company said the buy-back would be submitted for approval at a shareholder meeting on Dec.18. Kron will be replaced by Henri Poupart-Lafarge, an executive vice president of Alstom, the company said. Alstom will now focus on railway transport.
The French government has had to approve the sale; and European Union regulators had to be convinced that the deal did not breach anti-trust rules.
Alstom, which has said it will have little or no net debt after the GE transaction and the share buyback, is focusing on a rail market that is starting to consolidate. “It’s 65,000, and we’re ready to step forward”.Alstom has recently won significant awards for metros in Sydney, Kochi, Riyadh, Paris; for signalling solutions for the Toronto greater area and Denmark; tram systems for Rio de Janeiro, Lusail and Sydney and suburban trains for South Africa.
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Alstom has also expressed interest in bidding for the planned Kuala Lumpur-Singapore high-speed rail project.
