* Joint offer could be approved by Siemens board on Sunday
* Siemens would acquire gas turbines from Alstom, sources
* Mitsubishi would set up JV in steam turbines, take Alstom
* Under separate train deal, Germany might match French
By Jens Hack and Benjamin Mallet
MUNICH/PARIS, June 13 Germany's Siemens
and Japan's Mitsubishi Heavy Industries are
putting the finishing touches on a joint offer for Alstom's
turbine businesses that includes a cash element of
roughly 9 billion euros, sources close to the bidders said.
Under the complex offer, Siemens would acquire the gas
turbines business of Alstom while Mitsubishi would inject cash
and industrial assets into a joint venture in steam turbines,
the sources said.
As part of the deal, Mitsubishi and the French government
would take stakes in Alstom, acquiring a portion of the shares
currently held by French group Bouygues, one source
close to the matter specified.
Alstom would keep control of its energy transmission and
renewables activities, which would not be part of the
In a second step that one source described as "completely
independent" of the turbines deal, Siemens and Alstom would
combine their rail activities.
It is still unclear what stakes the two firms would have in
this business. If the French government took a stake, one senior
source said Berlin would also consider buying shares in order to
stay at "eye level" with Paris in a group combining the
high-speed ICE and TGV train activities of Siemens and Alstom.
"What is being discussed is an industrial and commercial
partnership in turbines," one source familiar with the matter
told Reuters. "But it's not enough for a deal to make sense on
paper. You need to see the stars align."
Two separate sources said Siemens and Mitsubishi would be
offering about 9 billion euros in cash under the turbines offer.
That compares to the 12.35 billion euros ($16.9 billion) offered
by U.S. conglomerate General Electric for all of Alstom's
energy assets, including turbines, renewables and grid
"The offer can't be compared with that of GE as they're so
different in nature," another source close to Mitsubishi said.
Siemens, Alstom and Mitsubishi all declined comment.
Under the proposed offer, which is expected to be rubber
stamped by the supervisory board of Siemens on Sunday evening,
Alstom would have a future in the energy business and be at the
centre of a European rail champion -- both potentially
attractive prospects for the French government.
"GE could still win a deal but for that they would have to
do what the French government wants, in other words come up with
an alliance rather than a buyout," the source close to the
But the complex proposal would also turn Alstom into an
unwieldy holding company, with myriad stakes in disparate
businesses. That may ultimately make it difficult for Siemens
and Mitsubishi to convince Paris that its deal is a jobs
When GE Chief Executive Jeff Immelt met with French
President Francois Hollande last month, he promised to create
1,000 new engineering and manufacturing jobs within three years,
according to sources close to the talks.
French Economy Minister Arnaud Montebourg reiterated in a
newspaper interview on Friday that he favoured an aliiance that
preserved Alstom's identity, industrial sites, decision centres
(Additional reporting by Alexander Huebner in Frankfurt, Gernot
Heller in Berlin, Jean-Baptiste Vey & Natalie Huet in Paris;
Writing by Noah Barkin)