Selloff or Market Correction? Either Way, Here's What to Do NextSee Overvalued Stocks

France blocks US takeover of Canada-owned French nuclear valve makers

Published 06/10/2023, 12:36
Updated 06/10/2023, 17:15
© Reuters.
EUR/USD
-
EUR/GBP
-
USD/CAD
-
GBP/CAD
-
CAD/USD
-
USD/CNY
-
USD/CUP
-
FLS
-

PARIS (Reuters) - France blocked a deal that would have seen the takeover of two Canadian-owned French maker of valves used in nuclear reactors because it did not think commitments made by U.S. bidder Flowserve were sufficient, a finance ministry source said.

Flowserve, which makes pumps and valves, said on Thursday it was dropping its $245 million takeover of Montreal-based Velan, whose French subsidiaries Segault and Velan SAS make valves used in nuclear plants, submarines and aircraft carriers.

"The minister (Bruno Le Maire) took the decision to reject the two acquisitions because the commitments to reduce all risks associated with the deal were not sufficient," the French finance ministry source told journalists on Friday.

The French government has extensive powers to vet proposed takeovers of French companies that it considers to be strategically sensitive, though outright rejections are rare.

Flowserve Chief Executive Scott Rowe said on Thursday that the firm had sought to address all of the French concerns.

"We do not believe the decision aligns with the French government's stated goal of encouraging foreign investment into France's economy," Rowe said in the statement announcing that Flowserve was dropping its deal.

While President Emmanuel Macron has made a big push to promote foreign investment in France, he has also championed the idea of reinforcing Europe's strategic autonomy from other regions, particularly in terms of defence and energy.

Some French senators had aired concern about the takeover, in particular that it could mean the U.S. government could order Flowserve to hand over information from its French subsidiaries.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.