By Gilles Guillaume and Elizabeth Pineau
PARIS (Reuters) - The board of ALSTOM (ALO.PA)backed a proposed tie-up with General Electric on Saturday as the French government neared agreement with shareholder BOUYGUES (EN.PA)over the last major outstanding plank of the deal.
An accord is taking shape on the price at which the government will acquire 20 percent of Alstom from Bouygues and will likely be finalised on Sunday, two sources familiar with the discussions said.
Bouygues, GE and Alstom all declined to comment on the ongoing stake sale talks, even as the French industrial group's board unanimously endorsed the plan.
The GE deal "not only addresses the interests of Alstom and of its stakeholders but also provides assurances in connection with concerns expressed by the French state", the company said in a statement.
President Francois Hollande earlier raised the pressure on Paris-based Bouygues, warning that failure to agree a price for the stake purchase could still scupper the tie-up.
"If this sale did not go ahead at a price acceptable to the government, it would be necessary to reconsider the alliance as it has just been announced," Hollande told reporters in Paris.
On Friday the government backed the proposed deal with GE, which vales Alstom's energy business at 12.35 billion euros ($16.77 billion), rejecting a rival Siemens-Mitsubishi offer it had previously encouraged as ministers sought guarantees on domestic jobs and activities deemed strategic.
The announcement drew a line under a two-month battle for Alstom that had become heavily politicised as soon as the first reports of an agreed tie-up with GE appeared in April.
But the official green light remains subject to strict conditions agreed with GE - as well as the government's purchase of the Alstom stake from Bouyues.($1 = 0.7366 Euros)
(Writing by Laurence Frost; Additional reporting by Jean-Baptiste Vey, Benjamin Mallet, Chine Labbe; Editing by Janet Lawrence and Susan Fenton)
