April 28, 2003 — ALSTOM announces that it has signed binding agreements to sell its small gas turbines business and its medium-sized gas turbines and industrial steam turbines businesses in two transactions to Siemens AG, which are key steps in its continuing disposal program.
The total enterprise value of the two transactions is à¢â€š¬1.1 billion. Net cash proceeds to ALSTOM are expected to be approximately à¢â€š¬950 million after deduction of debt transferred and certain other adjustments for cash items.
The first transaction will cover the small gas turbines business, and the second transaction will cover the medium-sized gas turbines and industrial steam turbines businesses.
The industrial turbines businesses being sold account for approximately 10% of ALSTOM’s Power sector revenues and sales are typically to specialist industrial customers, for example in the oil and gas industry. They include:
* the small gas turbines business (3 MW – 15 MW) based principally in the UK;
* the medium-sized gas turbines business (15 MW – 50 MW) based principally in Sweden;
* the industrial steam turbines (up to about 100MW) business with manufacturing sites in Sweden, Germany and the Czech Republic, and global customer service operations.
In the year ended 31 March 2003, ALSTOM’s industrial turbines businesses generated sales of approximately ¿1.25 billion and an estimated EBIT(1) margin of approximately 7%. They employ some 6,500 people.
The transactions are subject to regulatory clearances and documentation is being submitted to the relevant merger control authorities.
Commenting on the sales, Patrick Kron, Chairman and CEO of ALSTOM said:
“These transactions constitute a key milestone in our action plan to strengthen our financial base. We thank all our employees in the industrial turbines businesses for their support and are confident that they will have a successful future within the Siemens Group.”
Dresdner Kleinwort Wasserstein and Cràƒ©dit Agricole Indosuez are acting as financial advisers to ALSTOM on the disposal.
ALSTOM is the global specialist in energy and transport infrastructure. The Company serves the energy market through its activities in the fields of power generation and power transmission and distribution, and the transport market through its activities in rail and marine. In fiscal year 2001/02, ALSTOM had annual sales in excess of à¢â€š¬23 billion and employed 112,000 people in over 70 countries. ALSTOM is listed on the Paris, London and New York stock exchanges.