Framatome, Siemens forge nuclear alliance

["Sandy Perle" <sandyfl@earthlink.net>]

Monday December 6, 7:20 am Eastern Time

Framatome, Siemens forge nuclear alliance

PARIS, Dec 6 (Reuters) - French nuclear group Framatome and Germany's 
Siemens AG sealed years of cooperation on Monday with a nuclear 
energy alliance that will propel them into a leading global position 
in the industry.  

The Franco-German joint venture will be 66-percent owned by Framatome 
and 34 percent by Siemens. It could be operational by the third 
quarter of 2000 and will have annual sales of 3.1 billion euros 
($3.13 billion), the pair said in a statement. The deal, signed on 
December 6 and due to be finalised in the coming months, confirmed 
months of speculation that Siemens' would prove the ideal match for 
Framatome, which was openly seeking a European partner to boost its 
position in nuclear materials.  

``This agreement -- which promotes the European nuclear power 
industry to a global leadership position -- bears testimony to the 
will of Framatome and Siemens to increase their competitiveness on 
international markets, with a particular focus on North America and 
Asia,'' they said.  

Framatome and Siemens have been cooperating since 1989 in an 
increasing number of fields and in particular in developing a 
pressurized reactor under an existing joint venture called Nuclear 
Power International.  

French Finance Minister Christian Sautter was quick to stress that 
the tie-up would not undermine the role of the French state in 
Framatome, 20 percent of which is still directly owned by the 
government.  

``This alliance does not prevent Framatome from being anchored in the 
public sector,'' Sautter told reporters, adding that the French 
government had favoured an alliance based on industrial rather than 
purely financial logic.  

The joint venture, still subject to approval by antitrust 
authorities, covers the full range of nuclear activities at the two 
parent companies and will operate in their domestic markets as well 
as internationally, the statement said.  

A separate agreement has been signed with France's state-run nuclear 
group Cogema, which has become Framatome's main shareholder with 34 
percent under a capital restructuring announced by the French 
government in July.  

Under the restructuring, which values Framatome at around 2.5 billion 
euros, French telecommunications firm Alcatel is in the process of 
divesting its 44 percent Framatome stake over two years. The stake is 
currently below 10 percent, a Framatome spokeswoman said.  

In the field of nuclear technology, Siemens, which has 4,100 
employees, posted 1989/99 sales of 1.1 billion euros. Framatome, with 
a workforce of 9,000, said it expected 1999 sales of two billion 
euros in nuclear technology.

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Sandy Perle					Tel:(714) 545-0100 / (800) 548-5100   				    	
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