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JBIC ready to fund MHI-Siemens bid for Alstom

Bloomberg

The Japan Bank for International Cooperation is ready to support Mitsubishi Heavy Industries Ltd.’s joint bid with Siemens for France’s Alstom SA.

“The global restructuring of the heavy electric machinery industry is taking place, and we have a mission to increase a number of globally flourishing Japanese companies,” Tadashi Maeda, the senior managing director of the bank, said in a recent interview. “We would certainly support them if we received a request” for funding assistance from MHI.

JBIC’s offer could ease the financing burden of MHI, which is seeking parts of Alstom’s energy business for €3.1 billion ($4.2 billion). The Tokyo-based company also plans to acquire as much as 10 percent of Alstom from Bouygues SA, a stake valued at about €900 million.

Mitsubishi Heavy spokesman Hideo Ikuno declined to comment Wednesday on its funding plans for the bid.

The government-run bank provided financing for trading firm Marubeni Corp.’s acquisition of Gavilon Holdings LLC and MHI’s joint venture with Vestas Wind System A/S.

MHI may raise funds via subordinated loans and preferred stock to avoid an increase in interest-bearing debt and a drop in credit ratings, Maeda said.

JBIC acquired preferred shares of Marubeni’s Gavilon Agriculture Holdings Co. unit for ¥60 billion after trading house Marubeni paid $2.7 billion for the U.S. grain and fertilizer business in July 2013. The bank had a similar deal in April to acquire preferred shares of a Denmark-based unit of MHI valued at €132 million to help its joint venture with Vestas.

MHI plans to acquire stakes in Alstom’s steam and nuclear turbine, power grid and hydro-electricity units, while partner Siemens is offering €3.9 billion for the French firm’s gas-turbine business, they said Tuesday.