Brussels, 08/09/2015 (Agence Europe) - The news has been doing the rounds since Monday and now it's official: the European Commission decided, on Tuesday 8 September, to grant its conditional authorisation to the purchase of the energy businesses of France's Alstom by General Electric (GE) of America.
This operation, with a pricetag of €12.5 billion, will bring together two of the largest players on the global market for heavy-duty gas turbines. “This is a big deal”, explained Competition Commissioner Margrethe Vestager. Following an in-depth investigation which took nearly eight months, the Commission has decided to make the operation conditional on the sale, to the Italian company Ansaldo, of central parts of Alstom's heavy-duty gas turbines business. It had concerns that one of GE's main rivals would be removed from this market and that high levels of concentration would push up prices on the market for a technology it describes as vital in the fight against climate change.
GE put forward Ansaldo as a potential buyer of these assets. This Italian company is an existing competitor on the heavy duty gas turbines market. It already has the knowledge, experience and an effective factory for the production of gas turbines. The Commission feels that it will resume Alstom's previous role and will maintain healthy competition. “We have ensured that existing European know-how in this sector is preserved and that future high-tech innovation based on Alstom's previous work can continue within Ansaldo. This is particularly positive because the heavy duty gas turbines are important for Europe's climate change and energy policy goals”, Vestager explained.
Alstom's acquisition by GE will not take effect until the Commission has formally evaluated and approved the definitive version of the sale to Ansaldo.
As regards the other activities included in the operation, the thermal power generation businesses (other than gas), grid and renewables, the Commission did not identify any competition concerns, essentially because the activities of the two companies are complimentary and do not overlap.
According to Commissioner Vestager, this operation shows that “Europe is open for business” and that it is possible to invest in Europe as long as the rules are respected. (Elodie Lamer)