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What GE’s Winning Bid Of Alstom Means

Recently, Alstom accepted General Electric’s (GE) offer after a bidding war, creating intriguing possibilities for French cleantech.

Greentech Media notes the French government accepted GE”s bid over Siemen’s and Mitshbishi’s joint offer. Originally, the German energy giant had offered an asset and cash swap of €10–11 billion ($13.8–15.2 billion). Mitsubishi added their own €3.1 ($4.2 billion) to sweeten Siemen’s pot.

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Image Credit: Wind Turbines via Flickr CC

However, at the end of the day, GTM said the French government chose GE’s bid because of them having more control over the process. Originally, GE had put in a $13 cash bid. However, the new pact will be “an alliance” between the mega energy companies and not be a complete take over.

In June, a new law passed in France that gave the government more power on merger and acquisitions in vital industries, including energy and transportation.

So what does this mean in the grand picture?

First, GE’s promise to sell its rail signaling business to Alstom, which offers some alluring prospects, including  possibly using GE’s current technologies in creating more efficient rail systems.

Second, the deal allows GE to gain a hold into the French wind market, and expand their global wind turbine business. GE was number one in the wind turbine market in 2012. However, declines in US wind installations in 2013 pushed it down to fifth last year. France ranked in 2013 eighth in global cumulative wind capacity at 2.6%, showing the potential for GE to expand its wind turbine business.

As GE provides good incentive for Alstom in wind energy, the same is true when it comes to smart grid technologies from Alstom.

With reports suggesting annual revenues reaching $73 billion by 2020, its understandable why Alstom has teamed with Cisco, Itron, and Duke Energy to further strengthen its smart grid market share. Smart grid market value will reach $400 billion world-wide by the end of the decade. With growing energy demand, and increased concerns about the high risks of climate change, interest will only continue to rise for smart grid technology.

One can wonder what will occur with Alstom and GE in France over the months ahead. It will be interesting to watch what occurs across the pound.

 
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Written By

is expected to complete the Professional Development Certificate in Renewable Energy from the University of Toronto by December 2017. Adam recently completed his Social Media Certificate from Algonquin College Continuing & Online Learning. Adam also graduated from the University of Winnipeg with a three-year B.A. combined major in Economics and Rhetoric, Writing & Communications in 2011. Adam owns a part-time tax preparation business. He also recently started up Salay Consulting and Social Media services, a part-time business which provides cleantech writing, analysis, and social media services. His eventual goal is to be a cleantech policy analyst. You can follow him on Twitter @adamjohnstonwpg or check out his business www.salayconsultiing.com.

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