GE makes twin open offer worth $389M for two Alstom arms in India

General Electric has made separate open offers to acquire additional stake in two public listed Indian arms of French power equipment major Alstom. If fully successful it would cost around Rs 2,340 crore ($389 million).

The US-headquartered conglomerate has offered to buy 25 per cent stake in Alstom T&D India Ltd for Rs 1,672 crore ($278.24) and up to 26 per cent of Alstom India Ltd for Rs 668 crore ($111 million).

This follows a global transaction where GE Energy announced that it is offering $13.5 billion enterprise value and $3.4 billion (€2.5 billion) of net cash to acquire Alstom's thermal, renewable and grid businesses.

The Alstom board has appointed a committee of independent directors to review the offer by June 2, 2014.

As a part of the proposed acquisition of the business by GE, it will also indirectly get control of Alstom T&D India as well as Alstom India. As of March 31, 2014, Alstom held 75 per cent of Alstom T&D India and 68.56 per cent of Alstom India.

GE has offered to buy shares of Alstom T&D India from public shareholders at Rs 261.25 a share and from Alstom India shareholders at Rs 383.2 a share.

Alstom T&D scrip was last traded at Rs 270 a share, down 0.44 per cent, while Alstom India shares last changed hands at Rs 457.5, up 0.7 per cent on Monday.

Alstom is one of the world’s leading energy solutions and transport companies. Present in India since 1911, Alstom has capabilities in engineering, manufacturing, project management and supply of products and solutions for power generation, transmission and transport infrastructure requirements. It has two flagship companies – Alstom India (formerly Alstom Projects) and Alstom T&D India. Together the two firms employ around 9,000 people.

Alstom T&D India is into power transmission business with a product portfolio ranging from transformers, circuit breakers, gas insulated switchgears, instrument transformers, protection relays and power system automation equipment. It has over 3,500 employees and eight manufacturing units.

(Edited by Joby Puthuparampil Johnson)

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