Alstom and Siemens offer concessions to win EU support for proposed merger

Transportation giants Siemens and Alstom have put forward a number of concessions they hope will allay the concerns the European Commission holds over its proposed merger.

Alstom and Siemens want to combine to create a new powerhouse with an estimated revenue of €15.3bn (£12.9bn).

The commission has raised concerns that the two companies will be so dominant in Europe that they could block competitors in the EU rail market and reduce choice for passengers.

European competition commissioner Margrethe Vestager recently said that Europe needed "champions…who were not coddled favourites".

Reuters reported that the concession being offered by Alstom and Siemens was that they will share the former's high-speed technology for 10 years in Europe rather than five.

In a statement on its website Alstom said: "Siemens and Alstom have continued the dialogue with the commission and have decided to further modify the remedies so as to answer the concerns raised by the feedback from the market testing. This package preserves the industrial and economic value of the deal – the order of magnitude of concerned sales communicated previously (i.e., around four percent of the sales of the combined entity) remaining unchanged."

However, Alstom warned there was still "no certainty that the content of this package will be sufficient to alleviate the concerns of the commission".

There appears to be divisions within the EU, with French finance minister Bruno Le Maire tweeting that the commission could not refuse the merger following the submission of the concessions.

"Alstom and Siemens have just made new concessions to the European Commission to merge and create a world rail champion, he said. "There is now nothing to justify a refusal by the European Commission of the merger between Alstom and Siemens."

Alstom et Siemens viennent de faire de nouvelles concessions à la Commission européenne pour fusionner et créer un champion mondial du ferroviaire. Plus rien ne justifie aujourd’hui un refus par la Commission européenne de la fusion entre Alstom et Siemens #QuestionsPol pic.twitter.com/ZiUQY6Z25M

— Bruno Le Maire (@BrunoLeMaire) January 27, 2019

The commission is expected to announce its decision in mid-February.