The French government has agreed to buy a 20% stake of rail and energy company Alstom from industrial group Bouygues.
This meets a condition set by Paris to back a General Electric deal to purchase Alstom’s energy business for 12.35 billion euros agreed on Friday.
The government and Bouygeos had sought to reach a deal before the expiry of General Electric’s offer on Monday.
“There’s no fixed price in the agreement because it’s a listed company so its price fluctuates on the market. Bouygues promised to sell a stake to us. We have a right to purchase it and we believe it’s in the interest of the public finances to do so. Bouygues has allowed to lend Alstom’s stock to us so that we can immediately have a role in the company. We can have 20% of the shares and be on the board of directors,” said Arnaud Montebourg, French Minister of Industrial Renewal.
Under the General Electric deal, the US conglomerate will sell its railway signalling business to Alstom and set up three joint ventures covering the French companies power grid business, renewable operations and nuclear steam turbines.
General Electric also pledged to create 1,000 industrial jobs in France as part of the deal.