Germany shrugs off criticism over Siemens' failed Alstom bid

BERLIN (AFP) - Germany's government on Monday rejected criticism it had insufficiently backed industrial giant Siemens in a bidding war for a stake in France's Alstom, which opted for US rival GE's offer instead.

Chancellor Angela Merkel's spokesman said "in principle, as we have repeatedly said, decisions about possible industrial cooperation ... are the responsibility of the enterprises involved".

France said Sunday it would take a 20-per cent stake in Alstom, while the engineering conglomerate has accepted General Electric's 12.35-billion-euro (S$20 billion) offer for its energy business.

The French government, which had earlier encouraged a Siemens bid, said Friday it favoured GE's bid over Siemens' joint offer with Japan's Mitsubishi Heavy Industries.

Ms Merkel's spokesman Steffen Seibert said on Monday: "The French government has made clear that from its point of view the public interest of France is affected, which is why it acted the way it did."

Earlier Monday, the chairman of the German parliament's economic affairs committee, former transport minister Peter Ramsauer, had charged that Berlin had done too little to support the Siemens offer.

Mr Ramsauer also accused Paris of "placing French unilateral interests ahead of European interests" by chosing a US partner, and of ignoring its public debt problems by buying a 20-per cent stake in Alstom.

Siemens chief Joe Kaeser meanwhile said the main reason its offer had failed was opposition from Alstom chief executive Patrick Kron, adding however that the door remained open for further talks.

"We made what was clearly the better offer in terms of jobs, price and future perspective for French and European industry," Kaeser told top-selling Bild newspaper.

He said that Mr Kron had "determinedly fought" the German bid, an opposition stance in the face of which Siemens "could not and did not want to" persist, he said.

Mr Kaeser also expressed satisfaction that the bidding war had driven up the price and made the deal less attractive for the US giant, saying that "of all the possible outcomes, we achieved the second best".

"Our competitor wanted to buy all of Alstom's energy business for a bargain price of about nine billion euros. This has turned into over 12 billion euros," he said.

"Also, the French state has stepped in as the main shareholder with 20 percent. A highly complex business structure is being created. All of this wouldn't have turned out this way without us." The newspaper Muenchner Merkur said: "One could get the impression that the Munich corporation (Siemens) is not just a good, but quite a satisfied, loser".

Alstom shares slipped 0.11 percent in Paris to 27.97 euros, shedding early gains.

Brokers Aurel BGC said that the formula agreed for the government to buy Alstom shares from conglomerate Bouygues was unnecessarily complex.

At Bank of America-Merrill Lynch, analysts said that the market might not like the deal for the French state to acquire a fifth of Alstom.