Running out of steam

GE scores a Pyrrhic victory in France

There's a paradox in General Electric's French triumph. The US conglomerate is finally getting Alstom's energy businesses, having seen off German nemesis Siemens and reached an accommodation with a hostile French government. Yet some other players won clearer victories.

After two months of fighting, GE is likely to get the Alstom businesses, on which it places an equity value of €12.4 billion euros. But a previously simple deal, built on the US group's ardour to expand in gas and steam turbines, has been larded with joint ventures, alliances, and a state golden share over nuclear issues. Moreover, GE is now effectively going into business with the French state itself, which is poised to buy 20 per cent of Alstom from top shareholder Bouygues. GE will say the deal's synergies are intact. But acquirers usually expect a freer hand in the businesses they buy.

For its part, Francois Hollande's government, loath to see France SA carved up by foreign titans, has won concessions on jobs, unit headquarters, and national security. Once again Paris has shown that the Anglo-Saxon "market for corporate control" loses something in translation. Bankers of the world, take Alcatel, Michelin and Vivendi off those M&A screens - at least for now.

Meanwhile, the also-ran Alstom and its long-suffering shareholders have both benefited from a lively bidding war, admittedly one not fought purely on financial grounds.

Even defeated rival Siemens can draw some consolation. It couldn't stop the world's biggest capital-goods company pitching up next door.

But it did help ensure both process and outcome were as complicated as possible.