* Says wants alliances, not takeovers
* Set to meet General Electric power chief Steve Bolze
* Says government doesn't rule out taking a stake in Alstom
PARIS, May 16 France is not for sale, Economy
Minister Arnaud Montebourg declared on Friday, brushing off
criticism from the European Union that his stance on foreign
company takeovers bordered on protectionism.
The government gave itself the power to block takeovers in
"strategic" sectors on Thursday, throwing up a potential
roadblock to U.S conglomerate General Electric's $16.9
billion bid for Alstom's power business.
The decree swiftly drew a warning against "protectionism"
from the EU official in charge of competition, and was called a
"bad idea" by France's main employers' group.
The government has criticised GE's bid, which has the
backing of the French engineer's board, favouring an alliance
between the companies rather than a straight sale that would
leave Alstom with just its smaller transport business.
It also wants Alstom to consider an alternative proposal for
an energy and transport asset swap with Germany's Siemens
to create two strong "European champions".
"We are not for sale. France is not for sale," Montebourg
said, interviewed on RMC radio. "We favour alliances, not
takeovers... We are not prey, especially in such strategic
"An alliance can be done with General Electric. It's not the
case right now, but that can evolve."
Montebourg said he would meet GE executives on Friday and
Alstom union representatives next week to discuss the future of
the company, which was bailed out by the French government a
decade ago and has strongly relied on state orders for its
trains and power turbines.
Alstom has given Siemens until the end of the month to
decide whether to make a formal rival offer before it enters
exclusive talks with GE.
Montebourg cited CFM, which makes jet engines and is
co-owned by GE and Snecma, a unit of French aerospace group
Safran, as an example of how a deal could work, calling
it "a brilliant French-American success".
GE has also been citing the venture's success in an attempt
to convince French leaders of its goodwill.
"Our strategy is no to dismembering, yes to alliances,"
Montebourg said, adding he had explained this preference to GE
Chief Executive Jeff Immelt.
He also pointed out that he had not stepped in last year
when French advertising company Publicis announced a
merger of equals with U.S. rival Omnicom. The
Publicis-Omnicom deal has since collapsed due to a battle for
Montebourg said the government would not let domestic
companies be "dismembered, chopped up into pieces and devoured"
and did not rule out taking a stake in Alstom as part of an
effort to secure its future.
He noted that French state lender BPI had 3,000 stakes in
companies and state fund APE had 71 stakes for a portfolio worth
110 billion euros ($150.88 billion).
"We are used to having a sovereign fund that intervenes in
companies' capital. Not ruling that out is I think a good way of
working," he said.
Steve Bolze, the president of GE's power unit, is among the
executives set to meet Montebourg. A spokesman for GE France
declined to comment on what Montebourg said and what would be
discussed during the meeting.
($1 = 0.7291 Euros)
(Reporting by Natalie Huet; Editing by Erica Billingham)