Alstom closed the sale of its Energy activities (Power generation and Grid) to General Electric for an amount of approximately EUR 12.4 billion. Consequently the Group is now entirely refocused on rail transport.
Proceeds of the transaction are used to acquire GE signalling activities for an amount of approximately EUR700 million and to reinvest in 3 Joint Ventures with General Electric (in the fields of grid, renewable and French steam & nuclear) for an amount of around EUR2.4 billion. As previously announced, part of the cash – in the range of EUR3.2 to EUR3.7 billion – should return to shareholders. The Board of Directors, meeting on November 4th, will propose the launch of a public share buy-back offer (OPRA) followed by a capital reduction through cancellation of shares. This operation will be subject to shareholders’ approval at a General Meeting which will be convened before year-end. After the full completion of the transaction, Alstom will be deleveraged and rely on a strong balance sheet.
Alstom benefits from a sound market with solid growing factors. Thanks to its presence on all continents, its complete range of solutions and constant innovation, it holds leadership positions in trains, services, systems and signalling, reinforced by the acquisition of GE Signalling. This activity, representing 1,200 employees, opens the signalling freight market to Alstom, while strengthening its presence in North America.
Alstom has a record order book providing long term visibility. It includes recent significant awards such as the metros for Sydney, Kochi, Riyadh, Paris; signalling solutions for Toronto greater area and Denmark; tram systems for Rio de Janeiro, Lusail and Sydney as well as suburban trains for South Africa, most of these projects being associated with long term maintenance contracts.
„Today represents a major milestone in Alstom’s history. We managed to secure a win-win deal with General Electric, which protects the interests of employees and customers in the Energy businesses, while reinforcing Alstom’s positioning in the transport industry. Alstom today holds leadership positions on a globally growing rail market and will rely on a solid financial base to support its growth strategy. This company, entirely refocused on transport, also benefits from a skilled management team led by Henri Poupart-Lafarge and I am confident in its ability to drive the Group towards future successes” declared Patrick Kron, Chairman and CEO of Alstom.
“Five years ago, 70% of our orders were made in Europe. Today, the majority of our orders are made outside Europe. This shows how Alstom has managed to develop from its home base to the rest of the world. The company is now present in over 60 countries and is executing about 400 projects worldwide. We are currently executing projects on all continents, whether it is supplying components, trains or fully integrated systems, including signalling, services and infrastructure”, Henri Poupart-Lafarge, President of Alstom Transport, said in an exclusive interview for Railway PRO (June issue).
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