General Electric set to hit back with improved offer for Alstom

General Electric is reportedly preparing an improved offer for the energy arm of Alstom that it will unveil to the French government and unions today.

Alstom’s board is due by Monday to announce its choice between General Electric’s €12.4bn (£9.93bn) cash offer and a competing proposal by Germany’s Siemens and Japan’s Mitsubishi Heavy Industries.

“General Electric is seeing the government and the Alstom unions tomorrow,” a source close to General Electric told Reuters yesterday. “The offer will, of course, be improved.”

Almost immediately after Siemens and Mitsubishi presented their rival plan on Tuesday, President Francois Hollande’s government told both sides to come up with better offers.

Siemens says its proposal with Mitsubishi values Alstom’s power arm at €14.2bn – nearly €2bn more than General Electric’s.

The two existing offers are very different in nature. Siemens’ bid would see it buying just the gas turbines arm of Alstom and Mitsubishi taking minority stakes in its other power activities. General Electric’s offer is for all of Alstom’s energy arm, including its grid business and renewables unit, which accounts for 70 per cent of its revenue.