OREANDA-NEWS. September 09, 2015. I am here to announce that the European Commission today has approved the 12.5 billion euro takeover of the energy related business of French engineering company Alstom by General Electric of the United States. This transatlantic deal brings together two of the largest players active in electricity generation equipment worldwide.

The Commission carefully investigated the potential effects of the merger on effective competition in Europe within the strict deadlines set by the EU Merger Regulation. It was notified to us less than eight months ago.

The Commission has now concluded that, in the light of General Electric's commitment to sell off part of Alstom's business, the deal would not harm effective competition on European markets. In particular, General Electric offered to sell Alstom's activities related to heavy duty gas turbines used to generate electricity to the Italian company, Ansaldo.

Ansaldo is already an established competitor in the heavy duty gas turbine market and with the addition of Alstom's assets, it will get the capacity to replace Alstom's role in the market. Our decision makes clear that General Electric will first have to get the Commission's formal approval of the completion of the transfer of assets to Ansaldo, before it can go ahead and implement the acquisition of Alstom.

Our analysis showed that without this divestiture, Alstom turbines risked disappearing from the market. As a result, choice would have gone down and prices up.

Apart from heavy duty gas turbines, General Electric will acquire all of Alstom's other energy related business activities. These activities range across nuclear, coal-fired, wind and hydro power plants as well as electricity transmission equipment. We did not find any competition problems in these areas essentially because the activities of the two companies are complementary and do not overlap.

This decision is important for three reasons:

First, the case illustrates that Europe is open to investment from abroad for companies that see opportunities for growth here. These investments must of course take place in full accordance with European competition rules. You can come and invest in Europe, but you cannot buy your way to a monopoly. During the investigation of this transatlantic transaction, the Commission has cooperated closely with other competition authorities around the world. I am particularly grateful for the very close and successful cooperation with the Antitrust Division of the US Department of Justice, both as regards the investigation and as regards the analysis of suitable remedies. We have come a long way with transatlantic cooperation since GE tried to acquire Honeywell in the beginning of the millennium.

Second, thanks to our merger control system, we have been able to ensure that there will continue to be effective competition in a market which has a direct impact on the cost of electricity. Europe's power generators will continue to be able to choose between a competitive selection of advanced, innovative and efficient gas turbines when building power stations and when selecting whom to service their existing gas turbines. And in turn, European consumers and businesses should enjoy cheaper and cleaner electricity.

Third, we have ensured that existing European know-how in this sector is preserved and that future high tech innovation based on Alstom's previous work can continue within Ansaldo. This is particularly positive because the heavy duty gas turbines are important for Europe's climate change and energy policy goals. The heavy duty gas turbines are not only the most efficient, cleanest and flexible fossil fuel power generation technology but is also an important complement to generation from renewable sources – when the wind stops blowing or the sun is not shining, it's mostly gas-fired plants that can immediately step into the breach to make sure the lights don't go out.

Alstom's heavy duty gas turbine technology is currently one of the most advanced, flexible and cleanest available. It is particularly well-suited to meet European customers' requirements, and it was crucially important to ensure it did not disappear.