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Mitsubishi Heavy Industries and Siemens specify proposal to Alstom

20 June 2014

Mitsubishi Heavy Industries (MHI) and Siemens today submitted an offer letterspecifying further the proposed transaction to Alstom. With the specified offer MHIand Siemens reaffirm their commitment to strengthen Alstom as an independentGlobal Player in Energy and Transport. After extensive discussions with allstakeholders over the past days MHI and Siemens reviewed their proposal withregards to reducing complexity, strengthening execution and narrowing riskexposure. Based on this, MHI and Siemens decided to further simplify the structureof the proposal for the benefit of all parties involved. This resulted in an additionalcash contribution of Euro 1.2 billion to Euro 8.2 billion, while the total valuation of Alstoms energy business increases by Euro 400 million to Euro 14.6 billion.

The specified proposal continues to preserve Alstom’s current perimeter in almostall its activities, enhances its industrial sustainability, strengthens its financialstructure, enabling it to be a approx. Euro 20 billion revenue French listed group.With additional 1,000 new created jobs by MHI and additional 1,000 apprenticeshiptraining positions by Siemens the proposal will foster job creation in France. MHIand Siemens continue to firmly believe that their proposal is the best one for Alstom,its employees, its clients, its shareholders and French national interests. Suchproposal is superior industrially, financially and socially.

The specifications result in the following measures:
MHI now intends to buy a 40 percent stake in the combined steam, grid and hydrobusiness of Alstom. This amendment will significantly simplify the implementation ofthe transaction, as this investment may now be undertaken through one singleholding company, as opposed to three JVs as contemplated in its June 16thproposal. Therefore cash contribution from MHI increases by Euro 800 million, from Euro 3.1 billion up to Euro 3.9 billion, while the valuation of the underlyingbusinesses remain unchanged.

Based on a subsequent, more advanced opportunity / risk analyses Siemens hadbeen able to increase its cash offer by Euro 400 million. This will increase the totalevaluation of the proposal accordingly to Euro 4.3 billion.

In addition to the proposed Letter of Intent for the Rail business, Siemens offers toenter immediately into a Joint Venture for Mobility Management including Signallingbetween Alstom and Siemens.

Mitsubishi Heavy Industries, Ltd. (MHI), headquartered in Tokyo, Japan, is one of the world’s leading heavymachinery manufacturers, with consolidated sales of 3,349.5 billion yen in fiscal 2013, the year ended March 31,2014. MHI’s diverse lineup of products and services encompasses four business domains, "Energy & Environment","Commercial Aviation & Transportation Systems", "Integrated Defense & Space Systems" and "Machinery,Equipment & Infrastructure."  For more information, please visit the MHI website below: http://www.mhi.co.jp/en/index.html

Siemens AG (Berlin and Munich) is a global powerhouse in electronics and electrical engineering, operating in thefields of industry, energy and healthcare as well as providing infrastructure solutions, primarily for cities andmetropolitan areas. For over 165 years, Siemens has stood for technological excellence, innovation, quality,reliability and internationality. The company is one of the world’s largest providers of environmental technologies.Around 43 percent of its total revenue stems from green products and solutions. In fiscal 2013, which ended onSeptember 30, 2013, revenue from continuing operations totaled €75.9 billion and income from continuingoperations €4.2 billion. At the end of September 2013, Siemens had around 362,000 employees worldwide on thebasis of continuing operations. Further information is available on the Internet at: www.siemens.com.

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