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Monday, June 22, 1998 Published at 10:25 GMT 11:25 UK

Business: The Company File

Alstom steams ahead

Alstom float steams ahead with 4.3bn price tag

Engineering company Alstom, which makes Eurostar trains, has been given a stock market value of 4.3bn. The valuation makes it Europe's largest ever flotation, excluding privatisations.

The company has been floated on the Paris stock exchange, and its shares are also listed in London and New York. Shares were valued at 205 French francs (20), in the middle of the price range predicted by the company.

Formerly known as GEC Alstom, the company was originally a 50-50 joint venture between UK electrical engineering giant GEC and French-based Alcatel.

The two founding members have retained 21% each of the newly quoted company.

Shares oversubscribed

Alstom's chairman and chief executive Pierre Bilger said the initial public offering was more than three times oversubscribed.

The share offer to Alstom staff was taken up by 60% of the workforce. Senior managers look set to receive large bonuses as a result of the flotation.

Mr Bilger said: "We have been delighted by the response to the global offering to which many of the world's leading institutional investors, private investors and Alstom employees have subscribed.

"Both Alcatel's and GEC's shareholders have also demonstrated their commitment to Alstom by applying for a significant proportion of the shares on offer.

"We begin life as a publicly-quoted company with a quality shareholder base and a sound platform on which to realise our ambitions."

[ image: Sixty per cent of Alstom staff bought shares]
Sixty per cent of Alstom staff bought shares
As well as the Eurostar, the company also builds locomotives for France's high speed TGV railway, trains for the Paris Metro and recently won a contract to supply tilting trains for Virgin on the West Coast line between London and Glasgow.

Fears that the French-based company's share price would be hit by worries about economic turmoil in the Far East failed to materialise.

It has 21% of its export business tied up in Asia, and investors fear this business could be hit if the yen and other Asian currencies continue to drop.

As well as engineering, Alstom is also involved in transport and energy markets.

Earlier this month, it said its shares would be priced between FF190 (19) and FF220 (22).

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