German tech giant Siemens and US company GE are competing for the French concern Alstom. The French president has vowed to intervene in the affair, which reveals many of the country's problems.
Alstom CEO Patrick Kron and his General Electric counterpart Jeffrey Immelt appeared to have everything signed, sealed, and delivered. GE, one of the biggest technology companies in the world, was to take over the French company for almost ten billion euros ($13.8 billion) - but the two companies had not banked on the interference of politicians.
"We will not allow this national flagship to be sold behind the back of the shareholders, the employees, and the French government," Economy Minister Arnaud Montebourg said on Twitter on Monday morning (28.04.2014). The state would "defend the economic and industrial interests of France," he added.
Alstom is considered a strategically important company in France, because it is part of the energy sector, manufacturing turbines for the country's many nuclear power stations. But there is more at stake: the Alstom case is "unfortunately another sign that France has gone off the rails," Jean-François Copé, chairman of the conservative opposition UMP party, told the Europe 1 network.
"Let us not repeat the mistakes of the past," tweeted former socialist cabinet minister Jean-Pierre Chevènement, before naming "Pechiney, ArcelorMittal, Lafarge" - all companies that had been swallowed by the foreign competitors.
Not included in Chevènement's list was PSA-Peugeot-Citroën, which has just been bought by Chinese investors Dongfeng and the French state . Shareholders gave the green light for the bailout last Friday.
These examples show that France is in danger of losing its industrial base. The European Union statistics office Eurostat has calculated that industry accounts for only 12.8 percent of the country's economic power - half as much as in Germany, and significantly less than in Spain or Italy.
Ten years ago, a conservative French government bailed out Alstom with taxpayers' money, preventing a takeover of its energy sector by Siemens. Now that same plan - Siemens buying the energy tech component of Alstom - is supposed to provide a solution. In return, the German company is said to be prepared to devolve its rail business to Alstom. At the moment, the French firm's high-speed TGV trains are in direct competition with Siemens' ICE trains.
General Electric (GE) and Siemens each have a turnover of some 75 billion euros, dwarfing Alstom's 20 billion euros.
"Alstom has global sales, but a lot of its activities come from French costumers, for example SNCF or Electricité de France," said Tomasz Michalski, economist at the HEC economic school in Paris. "And those customers haven't brought a lot of business in the past few years."
The French government seems to prefer Siemens' offer to that of GE, but has no objections to a foreign takeover in principle.
"There is still a knee-jerk reaction to keep French companies in French hands," Michalski told DW. "However, I would say the French government knows it's heavily indebted; it still runs a huge deficit; the financial capacity to intervene is very limited."
But Michalski sees signs of a change of heart that is not just down to the lack of means. When steel company ArcelorMittal closed down its plants in Lorraine in 2012, there was some political outrage - but no intervention. Nor did the government do anything when Lafarge, the world's second biggest manufacturer of construction materials, announced that following its merger with market leader Holcim it was moving its headquarters to Switzerland.
On the other hand, the state did attempt to prevent storied industrial company Pechiney from suffering the same fate. Then the fourth biggest aluminum producer in the world was taken over by the Canadian Alcan group in 2003.
"Alcan dismembered Pechiney, sold it in pieces and laid people off," said Michalski, adding that for the French it was shocking, because they have more of a stakeholder culture.
He also argued that it had been a shock to the French to see the protection of jobs and tax income subordinated to the interests of shareholders.
"That's why the French prefer alliances with companies from Germany, which also has a stakeholder culture, to alliances or takeovers by firms from the Anglo-Saxon shareholder culture," he said.
For the French economy minister, the Siemens offer could create two European champions. Montebourg compares the current situation with the establishment of European airplane manufacturer Airbus, which now competes with the previously dominant US manufacturer Boeing.
"We will either be bought by Boeing," Montebourg said on Twitter, "or we create one Airbus of energy and one of transport."
German Economy Minister Sigmar Gabriel, for his part, likes the idea. His spokesman said the fusion of Siemens and Alstom offered "huge opportunities" for both countries.