Alstom and Schneider in Areva deal
SHARES in Alstom and Schneider Electric rose yesterday after the duo pushed aside non-French rivals to enter exclusive talks to buy Areva’s nuclear transmission and distribution business.
Several analysts said the French consortium’s €4.09bn (£3.7bn) offer appeared to be fair and the bid removed uncertainty that Areva might sell to Japan’s Toshiba and American General Electric.
Areva, 93 per cent owned by the French state, said on Monday night it had begun exclusive negotiations with French engineering group Alstom and Schneider.
However, analysts were cautious about the future profitabilty of the business, noting that Areva’s first-half 2009 earnings had disappointed.
“This (deal) seems attractive but investors should bear in mind the poor free cash flow profile of the business,” WestLB said.
Shares of Alstom and Schneider were the two main gainers in France’s CAC-40 index. Alstom rose 6.7 per cent to close at €49.77, while Schneider added 3.8 per cent to close at €75.67.
The French government had made no secret of wanting to keep the assets in national hands.