By Benjamin Mallet and Natalie Huet
PARIS (Reuters) - Siemens
The German and Japanese groups said on Wednesday they were discussing a joint offer for Alstom's energy assets that would compete with GE's $17 billion proposal and would be worth around $9.8 billion, according to the Nikkei newspaper.
The Siemens-Mitsubishi plan would not be a direct buyout of Alstom's power assets but would rather set up one or several joint holdings in power, according to two sources familiar with the plan.
They added that Siemens was still ready to give Alstom its train business as part of the deal, although the French group has so far not shown much interest in such an asset swap.
Such a plan could, however, address calls from the government to favour partnerships over a straight sale of Alstom's power arm - 70 percent of group revenue. They fear the company would be left vulnerable once it was reduced to its smaller transport business.
Two French newspapers said on Thursday that Mitsubishi is considering taking a direct stake in French engineering group Alstom as part of an offer with Siemens.
Financial daily Les Echos said Mitsubishi is considering buying part of French Bouygues's
At a later stage, after an expected offer for Alstom on June 16, Siemens would contribute its transport assets to Alstom, which would remain a listed company with activities in power grids, wind turbines and transports, Les Echos wrote.
Le Figaro said Mitsubishi would propose an alliance with Alstom modelled on the Renault-Nissan alliance. That would involve Mitsubishi taking a minority stake in Alstom's power activities (excluding grids) or even buying part of Bouygues's stake.
The paper also said Siemens would propose buying Alstom's gas turbines unit and give Alstom its rail transport business.
Alstom is the maker of France's iconic TGV high-speed trains and supplies power equipment used in 40 percent of the world's nuclear plants.
It employs some 18,000 people in France, around a fifth of its global workforce. It was rescued by the state from near bankruptcy a decade ago and has since depended on public orders for rail and power equipment.
France has tried hard in recent weeks to drum up better offers for Alstom, saying it wanted to preserve the country's jobs and industrial know-how and even giving itself powers to veto a deal.
French President Francois Hollande, Economy Minister Arnaud Montebourg and David Azema, the head of French state holding company APE, met on Thursday to discuss the bids but made no statement.
Another meeting is scheduled next week, an official at the president's office said, stressing that the government did not favour one offer over the other at this stage.
"Our demands have never changed. What are our goals? To defend the country's energy independence, to maintain business and decision-making in France and to obtain the most favourable situation on the jobs front," the official said.
"It's against these criteria that we will continue to examine the proposals on the table. As far as our method goes, we don't have a preference for this or that proposal; we have demands."
Montebourg has been vocal on the Alstom case and has repeatedly warned against "tearing apart" the group, which he sees as a symbol of France's engineering prowess. He has openly favoured alliances and partnerships over divestment.
BREAKUP OR ALLIANCE?
News of Mitsubishi's partnership with Siemens emerged on Wednesday, and Hitachi, a joint-venture partner with Mitsubishi, said earlier on Thursday it also hoped to take part. The Nikkei report said the two Japanese companies would set up a joint venture to bid for Alstom's steam turbine operations, said to be valued at 500 billion yen ($4.90 billion).
"The closer we get to the deadlines, the more we hear of other groups being involved," said Didier Lesou, an Alstom union representative from CFE-CGC. "If the Japanese are in too, that would imply a breakup of Alstom's energy business. It's scary."
But two sources familiar with the matter, including one close to Siemens, said that was not the spirit of a Siemens-Mitsubishi plan, which would help allay antitrust concerns and would play the card of an alliance as advocated by Montebourg.
"MHI's plan with Siemens is to leave as much as possible in the hands of Alstom, to maintain a strong Alstom presence in power and to build a partnership involving one or several joint ventures, notably in turbines," said the other source, which is close to the French government.
Alstom declined to comment. Siemens, which also declined to comment, has said it plans to disclose a bid by Monday. Its supervisory board will meet on Sunday evening, according to a source close to the group.
GE agreed last month to extend its offer until June 23, at the government's request.
(Additional reporting by Emmanuel Jarry in Paris and Jens Hack in Munich; Writing by Natalie Huet and Geert De Clercq; Editing by Andrew Callus, Larry King)