M&A

6 November, 2009

GE in sovereign fund talks on Areva T&D bid-paper

PARIS, Nov 6 (Reuters) - General Electric (GE.N) is talking to sovereign funds in Singapore, Korea and Qatar about its possible bid for Areva's (CEPFi.PA) electrical power and transmission unit T&D, Les Echos newspaper said on Friday.

The move could reduce the interest of GE's main bid consortium partner, private equity fund CVC, and increase that of GE, the paper said.

GE could not immediately be reached for comment.

"According to several sources, under the initial scenario for the consortium led by the American group, CVC and other investors would have had a substantial minority interest of 25-30 percent, possibly more," the paper said.

"Talks now focus on reducing to around 10-15 percent the holding of the co-investors ...," it said.

"Besides contacts with Qatar sovereign fund QIA, General Electric started talks with Singapore's GIC, and Korean sovereign fund KIC...," the paper said.

State-owned nuclear reactor group Areva is selling its power transmission and distribution unit and has selected Japan's Toshiba (6502.T), the consortium led by U.S.-based General Electric, and French partners Alstom (ALSO.PA)-Schneider Electric (SCHN.PA) as possible buyers.

Binding offers are expected for Nov. 9 ahead of an Areva's decision for Nov. 16.

Economy Minister Christine Lagarde has said the offers for T&D would be assessed on the basis of price, industrial strategy and employment issues.

Areva, in which the French state holds a 91 percent stake, is selling the T&D unit, valued at between 3 billion and 5 billion euros by analysts, as part of an 11 billion-euro plan to fund expansion that includes a capital increase.

Several analysts have told Reuters that initial offers for T&D would not exceed 4 billion euros. (Reporting by Dominique Vidalon; Editing by Greg Mahlich)

Source: http://www.reuters.com