Alstom stated today that it will exercise its options to exit the renewable energy, grid, and nuclear businesses that were created as part of Alstom’s €12.4B energy sale to GE in 2015. The original deal gave GE control of Alstom’s gas-turbine operations. GE is now required to buy Alstom SA’s stakes in the three joint ventures for 2.59 billion euros ($3.1 billion).
The transfer to GE of the assets should occur this fall.
The redemption comes at a time when GE’s resources have already been strained by weak cash-flow and slumping demand. GE said in a regulatory filing in February that it had already been informed of Alstom’s intent to exit the ventures this year.
GE rose less than 1 percent to $14.72 ahead of regular trading in New York. Alstom advanced less than 1 percent to 38.89 euros at 2:50 p.m. in Paris.
Under the terms of the agreement with GE, Alstom said it will follow through with its right to exit the renewable-energy and grid ventures during the “exercise period” between Sept. 4 and Sept. 10. Doing so will trigger GE’s option to buy Alstom’s stake in the nuclear business, according to a statement.
Tagged with Alstom, Biggest News, GE