GE this month told EU watchdogs it’s willing to offload some of Alstom’s sale and servicing activities to Ansaldo Energia SpA, said the people, who asked not to be named because the matter is confidential. The U.S. company has also offered to sell some some intellectual property to the Italian firm, the people said. Alstom shares rose as much as 2.1 percent in Paris intraday trading. Getting access to Alstom’s installed base of large and very large turbines will be key for Ansaldo to become a viable competitive force -- allowing it to benefit from the French company’s client list and its profitable servicing business, two of the people said. As part of GE’s offer to the EU, Ansaldo could also buy Alstom’s Power Systems Manufacturing unit which can service gas turbines of different makes, they said. The offer is an opening gambit after months of talks with regulators, who are concerned that the GE-Alstom tie-up would lead to higher prices and less customer choice. Alstom said Monday it agreed to take 2.4 percent less for its energy business than GE’s original 12.35 billion euro ($13.7 billion) bid to help the Fairfield, Connecticut-based company craft a compromise to satisfy the EU. Opening GambitGE yesterday rose 0.8 percent to $25.95 at the close in New York, the first daily gain after five straight declines last week. The stock has fallen 3 percent since the announcement of the Alstom deal on April 30, 2014. Shares of the French company have dropped 11 percent in the same period. Alstom agreed to sell most of its energy unit to GE as it said it lacked the critical size to survive slowing demand for power plants in Europe and rising competition. The European Commission’s backing is key for GE, which saw its purchase of U.S. rival Honeywell International Inc. scuttled by the bloc’s regulator in 2001. The Brussels-based regulator has set a Sept. 11 deadline to rule on the Alstom deal. GE offered to give Ansaldo access to Alstom’s installed base -- turbines that have already been sold and for which the French manufacturer holds a long-term servicing agreement -- but the concessions don’t include the entire European fleet, one of the people said. Representatives for the commission, GE, Alstom and Ansaldo declined to comment. Siemens RivalryThe commission has argued the Alstom deal would leave only Siemens AG as GE’s main rival in Europe in the market for gas turbines used in gas-fired power plants -- potentially thwarting innovation and triggering price rises. GE accounted for 51 percent of the global gas-turbine megawatt capacity ordered last year, according to data from McCoy Power Reports. Siemens was second with 23 percent market share, followed by Mitsubishi Hitachi Power Systems Ltd.’s 13 percent share, while Alstom sold 7 percent and Ansaldo had 3 percent. Shanghai Electric Group Co. agreed last year to pay 400 million euros for a 40 percent stake in Ansaldo.
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