The French government announced that General Electric Co. improved its offer for the energy unit of Alstom SA due to the fact that the companys Chief Executive Officer Mr. Jeffrey Immelt promised to create 1 000 new jobs in France. GEs move emphasizes the importance of the deal and is an attempt to persuade the French government to approve its offer for the power equipment business of Alstom SA. The bid of General Electric is estimated to 17 billion dollars.
One of the analysts, who work at Saxobank – Mr. Christopher Dembik commented on the situation in an interview for Bloomberg, saying: “The government is looking for broader electorate support after the failures in the European elections. The role of the government is to get the best offer from GE.”
According to a person close to the company, who asked not to be identified because the information is still private, General Electric is committed to creating 1 000 industrial jobs on the territory of France within three years. The companys efforts have been acknowledged by the French government, which now described General Electric Co.s plans as more precise. Currently, the U.S.-based company has about 10 000 employees in France, while about 8 000 to 9 000 people are employed in Alstoms energy unit.
In his last appearance before the National Assembly of France, General Electrics Chief Executive Officer Immelt made a promise to protect jobs and the industrial base of the country. This emphasized on the importance of the eventual Alstom acquisition to both the French government and the U.S.-based company. If the deal is finalized, this would be a great push of Mr. Immelts plans to turn General Electric Co. to its industrial roots, which means that the company would be provided with the opportunity to consolidate the companys positions.
An official representative of the French government refused to make any comments on the companys bid, but explained that employment levels are a “very important” aspect of the negotiations.
General Electric Co. was 0.34% up to close at 26.66 dollars per share yesterday, marking a one-year change of +12.97%. According to the information published on CNN Money, the 10 analysts offering 12-month price forecasts for General Electric Co. have a median target of 28.00, with a high estimate of 32.00 and a low estimate of 27.00. The median estimate represents a +5.03% increase from the last price of 26.66.
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