GE promises government 1,000 new jobs to stall counter-bid from Siemens
FORTUNE — General Electric improved its offer for Alstom’s energy assets after meeting with French President Francois Hollande on Wednesday, agreeing to create 1,000 new industrial jobs in France.
President Hollande’s government welcomed GE’s improved offer and said the guarantees are now more specific in the wake of a meeting between the president and CEO Jeffrey Immelt in Paris. Hollande and his Economy Minister Arnaud Montebourg had been critical of the $17 billion bid until now due to concerns about securing the local workforce. Over 3.3 million people are unemployed in France, over 10% of the workforce.
Immelt appeared before France’s National Assembly on Tuesday and appeased lawmakers’ concerns that the U.S. company would protect jobs in the nation’s industrial sector and ensure the country’s energy independence. GE also said it would open new sites in addition to creating jobs.
The French government has also been wooing other bidders for the Paris-based company’s energy unit as it negotiates with GE. Montebourg has been a vocal proponent of a bid from German-based Siemens.
Siemens plans to make an official offer by June 16 at the latest and has considered trading its trainmaking business for Alstom’s energy assets, according to news agency reports. GE countered that it would also be willing to partner with Alstom on its rail signaling unit and would consider selling the business to Alstom to strengthen its smaller transport arm, allowing the engineering group to compete with larger Asian rivals.
Alstom management and investors have been receptive to GE’s bid and say it will provide cash to help pay down debt and shore up the company’s transportation business.