General Electric (NYSE:GE) is apparently willing to sell off certain intellectual property assets to secure regulatory approval for its $17bn deal for Alstom SA’s power business, the Wall Street Journal report in a May 20 article.
The WSJ article indicated that GE CEO Jeff Immelt is willing to make some concessions, but not others, to win European regulatory approval. European regulators continue to review the deal that was announced by GE and the French company more than a year ago.
The WSJ article said that the regulatory approval in Europe has been extended until Aug. 21. The article also noted that French company’s sales and earnings have dropped in recent months.
GE is in the midst of a wide range of asset sales, the New York Times reported in April.
“Together, GE and Alstom will control 50% of the global HDGT [heavy-duty gas turbine] installed base, providing a very strong foundation for services growth,” according to a May 21 analysis by A.B. Bernstein and Senior Analyst Steven Winoker.
“Alstom’s share gains in 2014 are a clear positive, though the protracted anti-trust process in Europe appears to be taking a toll on the business (GE said as much),” according the Bernstein review. “Alstom did not register any major turbine order wins in Q1. We continue to like the Alstom transaction, as we see it as value accretive and providing growth into balance-of-plant services and products.”
GE management recently increased synergy estimates for the Alstom deal.