Alstom to Review $13.5 Billion Offer from General Electric

PARIS â€" General Electric and Alstom, the struggling French conglomerate at the center of a politically charged takeover battle, finally said publicly on Wednesday what the business world has known for a week: The American giant is ready to acquire Alstom’s energy business in a $13.5 billion deal.

Alstom, however, left open the possibility of a deal with Siemens of Germany and said it would establish a committee of independent directors to review the G.E. proposal before the end of May.

G.E. said the French company had “positively received” its offer for the energy business, which includes Alstom’s thermal power, renewables and electrical grid divisions. Alstom’s energy business employs 65,000 people and had sales last year of 14.8 billion euros, or $20.4 billion, about 70 percent of its total.

“This is a strategic transaction that furthers G.E.’s portfolio strategy,” Jeffrey R. Immelt, G.E.’s chairman and chief executive, said in a statement. “Power & Water is one of our higher growth and margin industrial segments and is core to the future of G.E.”

He said the deal would “generate more than $1.2 billion in annual cost synergies by year five and the transaction will be immediately accretive for G.E. shareholders.”

Since news of the talks leaked last week, the French political establishment has been seeking to force Alstom’s chief executive, Patrick Kron, to put the brakes on a deal that would dismantle a company that symbolizes France’s industrial and technological prowess.

Economy Minister Arnaud Montebourg has demanded that Alstom consider a less fully developed proposal from Siemens, the industrial giant, for an asset swap. But Mr. Kron and Alstom’s controlling shareholder, Martin Bouygues, have favored the G.E. proposal.

Alstom, in its own statement, confirmed that it had “received a binding offer from General Electric,” and said that its board had unanimously acknowledged “the strategic and industrial merits of this offer.”

Alstom said the committee of independent directors would take into consideration the interests of all stakeholders. “Patrick Kron and the committee will liaise with the representatives of the French State to consider their views,” the statement said.

The committee will be empowered to “consider unsolicited alternative proposals for the acquisition of Alstom, or of the power and grid businesses” â€" a reference to the Siemens offer.

Mr. Kron praised the G.E. deal. “Alstom’s employees would join a well-known, major global player, with the means to invest in people and technology to support worldwide energy customers over the long term,” he said in a statement.

A deal with G.E. would enable the French company to invest in the transport business as a stand-alone company, he said, as well as to pay down debt and return cash to shareholders.

Alstom and General Electric said they expected the deal to close next year.

The announcement came after Siemens’s board on Tuesday formally backed an offer to swap its transportation business for Alstom’s energy business. The German company said that it would proceed with an offer only if it gained access to Alstom’s books and management for four weeks to carry out due diligence.