ZCZC
BCN-21
EU-FRANCE-GERMANY-MERGER-RAIL
Brussels voices doubts over Siemens-Alstom rail merger
BRUSSELS, Nov 1, 2018 (BSS/AFP) – The EU has written to Alstom, the state-
controlled maker of France’s iconic TGV trains, and German industrial giant
Siemens to express doubts about their proposed merger of rail activities.
The historic tie-up announced over a year ago is intended to create a
European train-building champion big enough to take on world leader CRRC of
China, but the EU launched an in-depth investigation into the deal in July
over fears it could damage competition in the supply of trains and signalling
systems.
Now the European Commission, the bloc’s executive arm, has sent a
“statement of objections” to the two companies, setting out what it expects
them to do to get the deal approved.
“The Commission can confirm that it has sent a statement of objections to
the parties in the Siemens/Alstom case. Our investigation is ongoing,” a
commission spokesman said.
The two companies have 10 days to respond, while the commission has until
January 28 to give its verdict
On Tuesday France’s junior economy minister Agnes Pannier-Runacher
reiterated Paris’s support for the deal.
“It is very important for us because from an industrial point of view the
aim is to create European giants — it is this which will enable us to
compete effectively at the global level with US and Chinese operators,” she
said.
The proposed merger would create a new European rail behemoth, present in
60 countries with an annual turnover of 15.6 billion euros.
Alstom employs 32,800 people worldwide while Siemens Mobility has 28,800
staff.
Announcing the probe in July, competition commissioner Margrethe Vestager
said the EU would look into whether the deal would “deprive European rail
operators of a choice of suppliers and innovative products, and lead to
higher prices, which could ultimately harm the millions of Europeans who use
rail transportation every day for work or leisure.”
Britain’s Office of Rail and Road has also warned the merger would have
“significant adverse effects on competition in key railway supply chains” in
the UK.
BSS/AFP/HR/1008