France meddles in Alstom deal

The French government has made public its opposition to Alstom falling into American hands.

America's General Electric (GE) has made a $13.5bn bid for the energy business of France's Alstom, which also specialises in transport.

Alstom, which built France's power grid and makes its TGV high-speed trains, says it will review the offer and decide whether to enter exclusive negotiations with GE by June. That leaves the door open for a counter-offer by Germany's Siemens.

The French government has waded into the affair, with the economy minister Arnaud Montebourg openly agitating for a tie-up with Siemens. Alstom was bailed out by the French state in 2004 and has remained mired in debt.

What the commentators said

As The Daily Telegraph pointed out, President Franois Hollande's predecessor Nicolas Sarkozy trumpeted his rescue of the near-bankrupt Alstom in 2004, while he was economy minister thus ironically ensuring that it did not fall into the hands of Siemens.

Socialist Hollande "would be left red-faced" if a national champion saved by his arch-rival falls under American control. Never mind, of course, said The Wall Street Journal, that the GE deal would do far more to shore up activity and jobs in France, as there would be less overlap than in the Franco-German combination.

When will the French learn to butt out of business, wondered Allister Heath in City AM. Shareholders and executives may make plenty of mistakes, but "they make fewer than politicians".

Recommended

Kieran Heinemann: the history of shareholder capitalism
Investment strategy

Kieran Heinemann: the history of shareholder capitalism

Merryn talks to Kieran Heinemann, author of Playing the Market: Retail Investment and Speculation in Twentieth-Century Britain, about the history of t…
17 Sep 2021
Why it pays to face up to your investment mistakes
Investment strategy

Why it pays to face up to your investment mistakes

Buying stocks can be a complicated business. But selling stocks can be tricky, too – even if you sell for the right reasons. Max King explains how to …
17 Sep 2021
Are stockmarkets heading for a fall?
Stockmarkets

Are stockmarkets heading for a fall?

America’s S&P 500 stockmarket index has gained 30% over the past year. Valuations may be high, but that doesn't necessarily mean investors should sell…
17 Sep 2021
A nightmare 1970s scenario for investors is edging closer
Investment strategy

A nightmare 1970s scenario for investors is edging closer

Inflation need not be a worry unless it is driven by labour market shortages. Unfortunately, writes macroeconomist Philip Pilkington, that’s exactly w…
17 Sep 2021

Most Popular

The times may be changing, but don’t change how you invest
Small cap stocks

The times may be changing, but don’t change how you invest

We are living in strange times. But the basics of investing remain the same: buy fairly-priced stocks that can provide an income. And there are few be…
13 Sep 2021
Two shipping funds to buy for steady income
Investment trusts

Two shipping funds to buy for steady income

Returns from owning ships are volatile, but these two investment trusts are trying to make the sector less risky.
7 Sep 2021
Should investors be worried about stagflation?
US Economy

Should investors be worried about stagflation?

The latest US employment data has raised the ugly spectre of “stagflation” – weak growth and high inflation. John Stepek looks at what’s going on and …
6 Sep 2021