Siemens Enters Race for Alstom Unit German Industrial Group Has Started Bidding for Alstom Unit After GE Opens Talks
* Siemens SIE.XE -1.56% Says Has All Financial Means To Consummate Transaction With Alstom ALO.FR +10.93% — Letter
*Siemens Commits to No Layoffs in France For At Least Three Years -Letter
*Siemens Has No Plans To Dispose Meaningful Parts of Business It Acquires from Alstom -Letter
*Siemens: If Alstom Board of Directors Back Proposal, Siemens to Enter Immediately Negotiations—Letter
*Siemens: Deal with Alstom Unique Opportunity to Create Two Strong European Champions—Letter
*Siemens Proposed to Alstom Acquisition Against Cash Consideration — Letter
*Siemens Proposed to Buy Thermal Power Division — Letter
*Siemens Proposed to Purchase Renewable Power Division—Letter
*Siemens Proposed to Purchase Grid Division—Letter
*Siemens Values these Alstom Enterprises At €10B-€11B—Letter
*Siemens Also Considers to Transfer Parts of Global Transmission Headquarters to France—Letter
*Siemens Prepared to Contribute Significant Parts of Rail System Ops To Alstom — Letter
BERLIN—German industrial conglomerate Siemens said Sunday it had entered the running to acquire the power-generation unit of French heavy machinery maker Alstom SA.
General Electric Co. GE +0.53% of the U.S. is already in talks to buy the energy operations of Alstom.
"Siemens has submitted a letter to the board of Alstom to signal its willingness to discuss future strategic opportunities," Siemens said. The company declined to comment further.
An Alstom spokeswoman declined to comment.
A bid from Siemens could complicate GE's plans because a European linkup with the German company may be more welcomed by French authorities. Many Europeans consider U.S. companies to be more focused on profit and less concerned about employees and national interests than European firms.
Siemens competes with Alstom in areas such as production of power-generation and transmission equipment as well as train manufacturing. Siemens is stronger in the power sector than Alstom, but lacks its access to the French market, while Alstom is stronger in the growing market of high-speed trains.
General Electric's efforts to buy the Alstom unit ran into political headwinds Friday when French Economy Minister Arnaud Montebourg said his staff were pursuing alternatives to the possible deal in the hope of keeping the company in French hands.
Mr. Montebourg on Sunday wrote to GE Chief Executive Jeffrey Immelt to postpone a planned meeting and warn that a potential deal could face conditions from the French government.
On Friday, Mr. Montebourg said his staff were pursuing alternatives to the proposed sale—which he said Alstom had started negotiating "without informing the government."
French unions also have expressed concern about such a deal and have called on the government to prevent the company from being dismantled.
"Alstom is the symbol of French industrial strength and know-how," Mr. Montebourg told reporters Friday morning on a trip to southwestern France. "The government is expressing its patriotic concern and vigilance."
As a globally diversified technology business, Alstom has long been considered a strategic asset by French authorities. The government bailed out the company a decade ago and spun off some assets that ended in foreign hands. Over the past couple of years, Alstom has been struggling amid cutbacks in capital spending by Europe's utilities, slack economic growth on the continent and weaker emerging markets.
Mr. Immelt was planning to travel to France on Sunday to meet with the country's authorities, including Mr. Montebourg, to discuss his plans for Alstom, two people familiar with the matter said. Mr. Immelt had also planned to meet with French Prime Minister Manuel Valls and President François Hollande's staff, one of the people said.
A spokesman for GE declined to comment.
GE is in talks to buy Alstom's power-generation, renewable-energy and electricity-transmission businesses, people familiar with the matter said. Such a transaction would leave the French company a much smaller concern focused on commuter trains and rail infrastructure.
The deal would likely carry a price of more than $10 billion, according to people familiar with the matter. It could be completed by early next week, one of these people said.
The remarks from Mr. Montebourg, an outspoken minister known for butting heads with foreign companies, suggest the government could dig in its heels to keep Alstom in French hands. The company employs 18,000 people in the country and makes the iconic TGV bullet train. The minister didn't elaborate on the possible alternatives or say whether the government would be ready to invest cash in Alstom.
Alstom's energy business accounted for more than 70% of the company's €14.5 billion, or roughly $20.1 billion, in sales from last April through December, the first nine months of its fiscal year. The rail business accounts for the rest of the company's revenue.
In January, Alstom said it anticipated "moderately negative" cash flow for its thermal-power business in the second half of the year. That weak outlook drove the company's shares to a nine-year low.
An acquisition of Alstom's energy business would give GE new power-turbine business in emerging markets and Europe, and provide entry to the transmission-equipment market, where the American company lacks a strong presence.
Alstom moved to calm unions' concerns about a deal. In an unscheduled meeting with labor union representatives on Friday, Chief Executive Patrick Kron said the company was in talks over a transaction involving an industrial operation but that reports about a full takeover by GE were groundless, according to Christian Garnier, a representative of the company's CGT union. Mr. Kron also told labor representatives that the company's board was to meet Friday.