PARIS May 20 France's controversial decree
widening its control over takeovers in strategic industries is
meant to help discussions over alliances and is not there to
block deals, Economy Minister Arnaud Montebourg told lawmakers
The surprise decree adopted by the government last week gives
it the power to veto takeovers in more "strategic" sectors, in a
potential roadblock to U.S conglomerate General Electric's
$16.9 billion bid for French engineering group Alstom's
"This is not a decree for blockage, this is a decree for
negotiations. This is a decree for alliances, this is a decree
against carving up (French businesses)," Montebourg said. "Yes
to alliances, no to tearing up (businesses)."
The takeover decree drew swift criticism from France's
employers group and the European Union official in charge of
competition, who warned against the risk of protectionism.
But the government, which has said France "is not for sale,"
is favouring an alliance between the companies rather than a
straight sale of Alstom's power arm that would leave the French
group with just its smaller transport business.
The government has also pushed for a European tie-up between
Alstom and German rival Siemens as an alternative to
Montebourg, who along with Alstom chief executive Patrick
Kron will be questioned by lawmakers at length over the issue
later in the day, pressed that point on Tuesday, stressing that
French carmaker PSA Peugeot's tie-up with China's
Dongfeng was a model.
Describing the Peugeot-Dongfeng deal, which he recalled saw
the state take a bigger stake in the French group, he said:
"It's a balanced deal, this is what we want for Alstom, this
alliance can happen."
The government has declined to comment on a Reuters report
at the weekend which said Siemens was working on a formal
asset-swap offer which, according to one source, could see the
state take a stake of over 10 percent in Alstom.
France currently owns 0.9 percent of Alstom's capital via
state fund CDC.
(Reporting by Ingrid Melander; Editing by Andrew Callus)