France’s socialist government has claimed a resounding victory for state intervention after forcing General Electric (NYSE:GE) to significantly revise its $16.9bn takeover deal for Alstom’s energy businesses, which both companies approved at the weekend. The government announced on Sunday night it had agreed terms with the French conglomerate Bouygues for its purchase of a 20 per cent state stake in Alstom, worth about €1.7bn at prevailing market prices. The government insisted on acquiring the stake as a condition of accepting the GE deal.

There was dual cause for back-slapping in President Francois Hollande’s Elysee Palace late on Friday night. France had thrashed Switzerland in the soccer World Cup, thereby largely assuring its place in the next round. And the government had just imposed its will to end a two-month fight for control over ailing French engineering group Alstom. An official close to Hollande said of the decision announced hours earlier, defining the shape of a planned tie-up between Alstom and U.S. conglomerate General Electric, “France has shown it can negotiate cleverly and openly with multinationals.”

General Electric Co. says the board of France’s Alstom SA has approved GE’s $17 billion offer to buy Alstom’s power generation business. GE says in a statement that if shareholders and workers’ representatives approve, the deal will close sometime next year.

GE Reshapes Alstom Offer To Appease France

GE says it was informed of the decision on Saturday. On Friday, the French government dropped objections and supported the company’s offer. Alstom has favored a tie-up with GE but had to postpone signing any deal while the government intervened to seek assurances on jobs and decision-making.

GE Says Alstom Board Recommends Purchase Offer

General Electric revised its bid for the power arm of Alstom on Thursday, offering alliances in energy and rail to appease the French government and beat a rival proposal by Siemens and Mitsubishi Heavy Industries. It was the latest shot in a two-month fight for control of Alstom’s energy business that has seen the Socialist government give itself powers to block any deal in the name of protecting local jobs and influence over a strategic sector.

According to a makert Makers report from Bloomberg, the French state will enter an alliance with GE and take a 20 percent stake in engineering company Alstom SA to support a takeover.

Siemens and Mitsubishi Heavy Industries raised their offer for Alstom’s energy businesses to compete with a revised bid by U.S. rival General Electric. Siemens-MHI and GE have been facing off in a battle for control of Alstom’s power businesses that has seen the Socialist government give itself powers to block any deal in the name of protecting local jobs and influence over a strategic sector.

France Secures Alstom Stake Option Ahead Of GE Tie-up

France won an option to buy 20 percent of Alstom from construction group Bouygues on Sunday, in an eleventh-hour deal clearing the way for the agreed sale of Alstom’s energy business to General Electric . The government had backed the tie-up on condition that it first secured the Alstom stake from Paris-based Bouygues – leaving less than three days to negotiate an agreement before GE’s formal offer expires on Monday. Ministers are determined to maintain influence over a complex deal that parks some Alstom assets deemed strategically important to France within GE-controlled joint ventures.

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